Tuskys in haste to glue creditors to turnaround plan
Besieged retailer Tuskys is in a dash to glue creditors to its turnaround plan ahead of a crucial High Court ruling on a wind up petition on November 17.
The retailer is expected to host a fresh round of creditor meeting beginning Wednesday in what will be a convincing exercise as Tuskys pleads with the aggrieved trade partners to save it from the liquidator’s noose.
Tusker Mattresses Limited (TML) Chairman Benard Kahianyu says the retailer was forced to seek judicial protection following a spike in the number of legal actions facing the firm in various courts across the country.
Tuskys has mapped out a new plan to appease the aggrieved creditors which is primarily anchored on the capture of a new Ksh.2.1 billion investment by a Mauritius based private fund along with the restructure of old debt.
Earlier this week, High Court extended orders barring the attachment, sequestration, distress or execution against the property of the company paving the way for extended engagements.
“The court orders undoubtedly have provided much-needed relief, and we are glad that this also provides a platform for us to advance stakeholder consultations including the tabling of our business revival and a debt settlement plan with all our stakeholders commencing next week,” Mr. Kahianyu said.
The court order has nevertheless failed to stop the execution acts with more Tuskys outlets being shut this week over outstanding disputes.
Tuskys has for instance been shut out of its stores at Pioneer House in Nairobi Central Business District (CBD), Adams Arcade, Kitengela and Kakamega in this week alone.
At the same time, asset management firm ICEA Lion has the court’s green light to proceed with the auction of the retailer’s store at the Greenspan Mall in Donholm after the non-payment of arrears under a new restructured agreement.
In the courts, Tuskys face two wind up petitions which if advanced would see the retailer placed under administration as happened to the now defunct Nakumatt Holdings.
Tuskys is seeking to avoid this outcome by onboarding all creditors to its proposed turnaround plan which restructures the payment of debt arrears over time allowing the retailer to stabilize its operations.
The turnaround plan filed in the High Court if approved by the creditors will see Tuskys partly receive moratoriums on the outstanding arrears.
The scheduled creditors meeting, conducted largely online with commence with the engagement of suppliers in fast moving consumer goods (FMCG) category.
The retailer is further expected to engage its general merchandize partners, service providers, labour union representatives and space letting partners.