Property managers Knight Frank have been left with no option but to end business relations with struggling Kenyan supermarket chain Nakumatt over rent arrears.
“Knight Frank Uganda regrets to inform our loyal clientele that on 28th June 2017, Nakumatt stores at Acacia Mall – Kololo, Village Mall – Bugolobi and Victoria Mall – Entebbe were closed,” a statement from Knight Frank Uganda Head of Retail Mac du Toit reads.
This comes on the heels of Nakumatt’s Katwe branch at Muganzilwaza Plaza having been closed in April over a Shs297m debt.
In June, Nakumatt Mbarara’s landlords Mpororo Group Ltd (owned by minister Bright Rwamirama and his wife Florence filed a suit in the commercial court demanding that the retail giant pay them $569,339 (about Shs2bn) going as far back as 2013.
Knight Frank has not stated how much Nakumatt owes them.
The supermarket chain has faced tough times over the past year with sparsely populated shelves after most suppliers stopped dealing with them over non-payment.
In May, Matooke Republic reported that Nakumatt was to close several of its Ugandan stores over the company’s total debt that now stands at over Shs500bn.
Nakumat MD Atul Shah then referred to the closures as a branch culling strategy to help the company perform better.
“The branch culling strategy will start off with sub-optimally performing branches whose lease contracts are due for renewal to be followed by branches in poor locations,” Shah, was quoted.
Matooke Republic understands that there has been a delay in concluding a $75m cash injection by a strategic investor who had expressed interest in giving the supermarket chain the much needed financial shot in the arm.
As a result of the delay, Nakumatt is staring imminent closure in the face as staff and suppliers have gone several months without pay.
The company grew from a small mattress business Nakuru Mattresses in the mid-1980s to operations in Kenya, Uganda, Rwanda and Tanzania with annual turnover of $650m at its peak 2013. Those days are long gone.