Thursday, Jan 20, 2022
HomeEconomyCorporateCourt blocks Naivas from pursuing Ksh.6 billion stake sell

Court blocks Naivas from pursuing Ksh.6 billion stake sell

Naivas takes over Tuskys’ space at Juja City Mall

The  High Court has blocked further stake sales in Naivas Supermarket, following a fierce supremacy battle among siblings over the control of the retailer.

The battle follows the sale of a 30 percent stake to a consortium of investors for Ksh.6 billion.

The rivalry pits Mr Newton Kagiri Mukuha, the eldest son of Naivas founder the late Peter Mukuha Kago, and his brother David Kimani, currently serving as the CEO of Naivas.

Kagiri had moved to court seeking to oust Kimani as the CEO. He is also seeking a seat in the Board, a 20 percent stake and a share of the 20 percent stake held by his late father. The 20 percent stake is estimated to be worth Ksh.4 billion.

In 2014, the High Court ruled that he had no stake in Naivas after it was found that he ran down all the stores he inherited from his father.

Naivas received Ksh.6 billion from the International Finance Corporation (IFC), private equity firms Amethis and MCB Equity Fund and German sovereign wealth fund DEG recently, meant for an expansion drive.

Kagiri, who lives in Kayole estate in Nairobi, is also seeking a share of the Ksh.6 billion received from the investors.

A riling delivered by Justice Anyara Emukule in 2014 shows that Naivas ceased to be a family business in 1999 when assets that the late Kago had accumulated were shared among his children.

At that time, Naivas (then Rongai Self-Service Store) had three supermarkets in Elburgon, Rongai and Naivasha.

Kagiri was offered the Rongai store and a house. His younger brother, Simon Gachwe and sister, Grace Wambui, were given a house and the Elburgon store while David Kimani and his sister, Linet Wairimu, took over the Naivasha business.

Kimani and Mr Gachwe partnered to run Naivas. They gave their sisters a 15 percent stake each and a 20 percent ownership to their father. Kimani and Gachwe had a 25 percent stake each in Naivas until the sale of the 30 percent stake.

Kagiri wants the estate of his late father offered a 30 percent stake, Kimani’s stake cut to 10 percent from 25 percent, Wambui’s increased to 25 percent from 15 percent, Wairimu’s retained at 15 percent and him 20 percent.

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