The two will remain separate entities but Tuskys will take over the management of Nakumatt, its biggest historical competitor. On the other hand, the Atul Shah family will step down and pledge their shares to the financiers for a period of six years according to people with knowledge of the matter.
As part of the deal, Nakumatt will now access stock from suppliers using Tuskys supermarkets; goodwill and value chain.
The deal is expected to be scrutinised by the competition authorities as Tuskys and Nakumatt are already the country’s biggest retailers, with more than 115 stores and control more than 70% of the retail market.
Approximately 6,000 jobs will secured through the deal and the employees could now look forward to Christmas without having to worry about their futures.
Over the last few months, Nakumatt has been grappling with product shortages with suppliers refusing to supply their products until the debts were cleared, numerous court cases and striking employees, all these as a result of cash-flow challenges. Some of the creditors have filed several suits claiming that the retail chain has not met its debt obligations. They have sought to attach some of Nakumatt’s assets in a bid to recover the cash owed to them.
More To Come….
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