Tuskys is set to lose its largest store after Equity Bank initiated processes to auction its Imara building in the Nairobi Central Business District (CBD) at the junction of Tom Mboya Road and Accra Road in Nairobi.
The fallen retail giant has in the past year been vacating several spaces it once occupied as it struggles under the weight of debt to suppliers, lenders and landlords, but the auction of the Nairobi store would represent its first loss of one of their real estate assets.
Tuskys’ total debts are in excess of Ksh10 billion, with the figure including loans from local banks. Equity Bank is looking to auction the property to recover a Ksh650 million debt.
The busy five-storey commercial property is the biggest store in the Tuskys portfolio. The asking price is Ksh650 million. It is expected to go under the hammer on March 2, 2022.
“We are selling the building where Tuskys currently operates along Tom Mboya Street in Nairobi on public auction and the asking price is Ksh650 million,” a representative for the auction firm Antique Auctions confirmed.
The auction makes prospects of the chain’s come-back less likely. It notably comes amid a push by many of Tuskys’ creditors to have the chain liquidated to recover their debts.
The battles continue to play out in the courts. In 2021, Tuskys refused to reveal the identity of the offshore investor seeking to save the retailer in a Ksh2.1 billion debt financing deal as creditors questioned the supposed agreement.
The investor is reportedly a Private Equity (PE) firm based in the Cayman Islands.
At least 60 creditors led by home appliances maker Hotpoint Ltd took to court to petition Tuskys to not only reveal the identity of the investor but also terms of the deal – including whether or not it is secured, interest rate and repayment period. Hotpoint raised serious doubts on the deal’s credibility, noting that it was announced several months ago.
High Court judge Francis Tuiyot later gave the retailer 30 days from November 26 to reveal details of a restructuring plan that includes the Ksh2.1 billion debt financing deal and sale of assets worth Sh911 million.
He noted that failure to make the disclosures would likely trigger a hearing of a liquidation suit.