Regional retailer Tuskys Supermarket shareholders on Tuesday said it has signed terms of agreement with a Mauritius fund based company for financing facility worth Ksh 2.0 billion.
“This funding will help alleviate our current capital constraints impacted by Covid-19 and further reposition the business for increasing stakeholder’s value,” said Benard Kahianyu, Chairman of the Board.
However, the transaction details are subject to condition.
“The Tuskys Board and Management will engage all stakeholders in the coming days to agree on business going forward.”
To our customers, partners, suppliers and members of the staff, see below business capitalization update #TuskysRebirth .-MC pic.twitter.com/a0dRxp5ije
— Tuskys (@TuskysOfficial) August 25, 2020
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The cash-strapped retailer has paid Ksh.700 million to suppliers following its rollout of a custodial trading arrangement in July.
In July, it paid Ksh.2.77 billion in supplier dues to the Competition Authority of Kenya (CAK).
Tuskys has Ksh.6.2 billion in trade liabilities.
“If properly managed, we expect the debt financing to cushion the struggling retailer and enhance investor confidence in Kenya’s retail market, thus boosting the sector’s performance through fueling uptake of retail spaces. We also expect to see retailers invest in their e-commerce infrastructure and also decentralize to locations that are easily accessible from people’s homes,” Cytonn Investmestments note.
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