Cash-strapped Tuskys Supermarket will lose its first real estate asset through a public auction over a Sh650 million Equity Bank #ticker:EQTY debt, dimming chances of a revival for the once giant retailer.
The five-storey commercial building, which houses the retailer’s largest store and sits at the junction of Tom Mboya Road and Accra Road in Nairobi, will be sold when the auctioneer’s hammer falls on March 2.
This is the first major auction of properties linked to Tusker Mattresses Limited, the owner of the Tuskys brand, which has so far only lost merchandise to auctioneers for rent default.
The move to auction the building is the latest signal of the retailer’s continuing financial distress and could trigger multiple creditors to seize and forcibly sell its assets estimated at Sh6.67 billion.
Insiders at the Antique Auctions, which is driving the sale of the city centre property, linked the auction to an alleged Sh650 million loan that the supermarket operator owes Equity Bank.
“We are selling the building where Tuskys currently operates along Tom Mboya Street in Nairobi on public auction and the asking price is Sh650 million,” a representative of Antique Auctions said on Monday.
“They took a bank loan from Equity Bank that dates back to 2014 and they defaulted on payment.”
The sale of the property will also likely see the Tuskys Imara supermarket closed unless the new owner chooses to retain the retailer as a tenant.
A deposit of 25 percent of the total amount must be paid at the fall of the hammer or immediately after the acceptance of the bid in cash or a banker’s cheque and balance paid in 90 days to Equity Bank.
In a race to prevent collapse, Tuskys has been seeking to sell a majority stake to a consortium made up of an undisclosed private equity firm.
The proposed transaction is, however, yet to be concluded and Tuskys has kept details on the deal secret.High Court judge Francis Tuiyot gave the retailer 30 days from November 26 to reveal details of a restructuring plan that includes tapping a strategic investor for Sh2.1 billion and sale of Tuskys’ assets worth Sh911 million.The judge said failure to make disclosures would likely trigger a hearing of a liquidation suit, which could see the retailer wound up to allow creditors recoup their debt after an unsuccessful rescue attempt.Tuskys has hinged its recovery on the assets sale, the Sh2.1 billion and restructuring of its debts to […]
