The state has rejected Nakumatt’s bailout request, Nakumatt has been one of Kenya’s leading supermarkets which has,in the recent past, faced its fair share of trying times.
A state official stated that the government does not intend to apply the taxpayer bail-out request of the privately-owned retail store.
The trade principle secretary, Dr. Chris Kiptoo, asserted that Nakumatt could not be bailed out because it is a private company, unlike Uchumi that has the government as one of its stakeholders.
“We have no stake in Nakumatt and we are not bailing them out. We also have to consider the moral hazard where we will be encouraging private firms to come to the Government for help,” Dr. Kiptoo said.
When Uchumi was in a similar financial crisis, the Treasury offered a Sh.1.8 billion shareholder loan.
Nakumatt was victimizing the government for its current financial tremors.
He said he had not anticipated that Nakumatt would ask for a bailout.
The retailer’s boss Atul Shah had blamed the Government for its woes and suggested that the Government extend “goodwill to Nakumatt, considering that the current situation was not of their making.”
Mr. Atul Shah, managing director and CEO of Nakumatt Holdings Ltd., in writing the request for Nakumatt’s bailout, blamed the government for several issues such as the closure of Nakumatt Thika road branch in November 2008 among others, but Mr. Kiptoo pointed out that the letter did not address Nakumatt’s paying of debts to its suppliers, but scoped on blaming the government on issues of the past.
Written By: Collins Gathogo