Uchumi Supermarkets is banking on conclusion of talks with a strategic investor as well as the sale of a 2.4 billion shillings land in Nairobi to settle debts and reinvest in its business.
Industry and Trade Cabinet Secretary Adan Mohammed says the restructuring of Uchumi Supermarkets will involve the closure of some loss making branches.
He is rooting for establishment of a Fair Trading Office that will intervene in case retailers and suppliers have issues.
The retail sector is among key economic drivers even though official retail accounts for between 20% – 30%.
In recent years, the sector has been faced by a couple of challenges among them delayed payment to suppliers who are owed billions of shillings.
During a meeting convened for retailers, the government rooted for self-regulation and proposed establishment of a Fair Trading Office recognized by the law that would intervene in case of any issues between retailers and their suppliers.
Uchumi Supermarkets recently won a court case involving the sale of its 2.4 billion shillings land in Komarock, Nairobi.
This coupled with cash injection from a strategic investor with whom talks are at an advanced stage, is expected to capitalize the listed retailer to settle its debts as well as stock its outlets.
The challenges facing Nakumatt Supermarkets that owes creditors and suppliers about 28 billion shillings have deepened with its Tanzanian subsidiaries seeking to delink from the Kenyan operations.