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Nairobi Business Ventures (NBV), a local shoe and leather accessories retail chain operating under the K-Shoe brand, seeks a strategic investor to take over the business.
Mr Vasu Abotula, Chief Executive Officer NBV on behalf of the Board said the fashion retailer’s earnings for the current financial year are expected to be lower by at least 25 percent compared to 2018 earnings.
“In light of declining shoe business in particular and retail business in general, Nairobi Business Ventures has been working on a transaction and has focused on delivering on this initiative that will guarantee the viability of the company for the benefit of the shareholders.”
This is based on the forecasted financial results of the group for the year ending 31 March 2020.
In 2018, it posted a KSh9.5 million in losses.
Its total revenue rose by six percent to KSh8.4 million. Ksh7.4 million in operating expenses and KSh2.5 million in finance costs.
Further, in a cautionary announcement, the public listed company says it has commenced talks with a potential investor “Which could lead to an eventual take over of Nairobi Business Ventures by the Potential investor.”
If successfully concluded the retailer says “May have a material effect on the price of the company’s securities.”
However, “If a transaction does not materialise from these discussions, it will be subject to board, shareholder and all applicable regulatory approvals as required for Nairobi Business Ventures Limited.”
Nairobi Business Ventures Limited- Cautionary Announcement pic.twitter.com/mk23Ud8qvs
— The Trading Room (@tradingroomke) March 27, 2020
According to its external auditors Jessie & Associates, NBV has suffered from inadequate working capital and has been relying on shareholders loans for survival.
The auditors noted that NBV risks going out of business since “as at March 31, 2019 the company had a shareholders’ deficit of KSh36.2 million (2018: KSh31.5 million) as a result of loss in the current year and previous financial year.”
Nairobi Business Ventures Limited (“NBV” ) is a public listed company that was incorporated and registered in Kenya in March 2012.
NBV’s main business is the retail of leather shoes and leather accessories. NBV started out as a distributor of shoes in Kenya through the brand name ‘Kwanza shoes’.
The Company later in 2013 changed the brand name from ‘Kwanza to ‘KShoe’.
The Company currently runs six (6) KShoe brand retail outlets at prime locations in Nairobi.
The KShoe brand name is coined from “Kenya Shoe” with the ultimate aim of creating a brand that is entirely Kenyan.
