Cash strapped retailer Tuskys Supermarket owes creditors at least Ksh6.2 billion, it has emerged.
In a letter to the Competition Authority of Kenya (CAK), the retailer says it has reached an agreement to pay 40 percent of the amount (Ksh2.4 billion) over two years.
“Total trade supplier debt is Ksh6.2 billion. As at August 6, 2020, 40 percent of this supplier debt has been rescheduled and the respective suppliers have signed individual agreements to reschedule the debt to periods between eight months and 24 months. Having these debts rescheduled and restructured, allows Tuskys time to reorganise cash flows and meet supplier obligations,” the letter dated August 7 reads in part.
Tuskys also revealed that it has struck a deal with suppliers to have Ksh1.2 billion worth of goods delivered, with goods valued at Ksh200 million already supplied.
In June, Tuskys paid suppliers Ksh2.7 billion after the intervention of CAK, that warned the retailer of abusing buyer power.
In the same month, CAK barred Tuskys Supermarket from paying its directors or opening more outlets, unless they are consulted.
Tuskys was also stopped from declaring or paying bonuses, fees or other compensation to its directors.
The retailer has been running on empty shelves in the recent past, with some inside sources suggesting that the executive of the retailer are staging the downfall with the intention of opening new businesses.
Tuskys’ operations have been under scrutiny by CAK since April after reports emerged that it was not paying suppliers on time as provided for in their respective contracts.