Nakumatt outlets closed over Shs2bn rent, Shs300m taxes

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The rain that set out to wet Kenyan supermarkets Nakumatt is yet to cease. Last week, Nakumatt branch in Mbarara was closed over accumulated rent arrears to the tune of Shs2bn.

The regional retail outlet has been operating in Mpororo building along Buremba road in Kamukuzi division of Mbarara Municipality in a building owned by Bright Rwamirama, the minister of State for Veteran Affairs.

Earlier in April this year, Rwamirama and his wife Florence Rwamirama dragged Nakumatt to court for failing to pay them $569,339 (Shs 2b) in rent.

According to court documents quoted by Uganda Radio Network, Rwamirama says Nakumatt had not paid rent since 2013.

Nakumatt had already closed three of its branches in Uganda including Acacia Mall in Kololo, Village Mall in Bugolobi and Victoria Mall in Entebbe. The remaining outlets lack basic products.

In April, Nakumatt also closed its Katwe branch after it accumulated more than Shs 290 million in rent arrears.

Oasis mall chain closed over taxes

The East African reports that Uganda Revenue Authority (URA) closed chain’s main store at Oasis Mall in the heart of Kampala and two others, claiming unpaid taxes.

The closure effectively halted the retailer’s operations in the country, as those were the remaining shops after the others closed earlier for various reasons, but mainly unpaid rent over the past two years.

Now, the URA is demanding at least Ush300 million ($86,000), excluding accumulated interest for the past five years, officials say.

The supermarket chain is facing pressure over its operations across the region. In just one month, more than 11 suits have been filed at the High Court demanding a combined Ush4.7 billion ($1.343 million) owed to suppliers.

A separate set of creditors is demanding another over Ush500 million ($143,000).

Last week Justice Anna Mugyenyi, sitting in Kampala, commenced the trial of one of the many cases in which One to One Finance Uganda Ltd has sued Nakumatt demanding over Ush534,878,201 ($153,000).

Other creditors who have gone to court are Alure Group, Euroflex, The Celler Ltd, Khaddar Investments Ltd, Paramount Dairies (2010) Ltd, Brookside Ltd, Zoo Packaging Ltd, Applecus World Ltd, Crane Paperbag Ltd, Britannia Allied Industries Ltd and Charms (Ug) Ltd.

The legal redress being sought puts at risk all property held by Nakumatt (U) Ltd.

According to the court documents filed on April 12th, 2017, the three plaintiffs argue that the amount results from failure to pay rent for sub-leasing part of its multi-complex building to run a supermarket business in Mbarara, in an agreement entered into in September 2011.

At its peak, Nakumatt boasted over 60 stores across Kenya, Rwanda, Uganda and Tanzania. It is to the extensive and quickfire expansion that some experts attribute Nakumatt’s current financial troubles.

Another pending suit against Nakumatt is by Groceries Plus Ltd, filed on May 16, 2017, demanding $76,509 for supplies. Last year Nakumatt had to tussle with Future Electronics over a $120,283 case.

The Nairobi-headquartered supermarket chain entered Uganda in June 2009 with its first store at the Oasis Mall, followed by rapid expansion to nine stores by 2015.

Agencies

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