Nakumatt, the troubled Kenyan supermarket chain, is in talks with Tuskys, another Kenyan retailer, to allow Nakumatt restock its supermarkets and return to stability, according to reports in Kenyan media.
Under the deal, Nakumatt will “access stock from suppliers using Tuskys supermarkets’ goodwill and value chain,” according to The Standard. The newspaper also reports that Tuskys’ managers will provide leadership to the troubled retailer.
The deal is not a merger, with the two retailers to retain their brands. But Nakumatt’s owners are pledging shares to the financiers who have backed the move, The Standard reports.
Nakumatt and Tuskys are yet to confirm the reports, according to the Daily Nation. Neither has Kenya’s Competition Authority or its trade minister, who is mediating talks between Nakumatt and its creditors.
Nakumatt has been forced to close several branches in Kenya and Uganda following a cash crisis that came to a head last year. In Uganda, all its six stores were closed by mall landlords after it accumulated rent arrears and the Uganda Revenue Authority, which said it owes taxes. Suppliers also said the retailer had not paid them.
It is still not clear how the deal with Tuskys will affect Nakumatt’s operations in Uganda. Tuskys operates seven stores in Uganda.
What’s not in doubt, though, is that it has lost two of its most desirable locations. In the past three weeks South African retailer Shoprite has announced that it is replacing Nakumatt at Acacia Mall, Kololo, and Victoria Mall, Entebbe. The two stores, to be opened in the first quarter of 2018, will bring Shoprite’s stores in Uganda to four.