Sinking Ship: URA begins selling Nakumatt goods

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After closing Nakumatt’s main store at Oasis Mall in Kampala and two other stores last month over tax arrears amounting to Ugx. 300 million, Uganda Revenue Authority (URA) has started auctioning the goods of the once mighty retail giant as it moves to recover tax arrears.
Nakumatt has closed five branches in Uganda including; Acacia Mall, Village Mall in Bugolobi, Victoria Mall in Entebbe, Katwe Branch and Mbarara Branch. The retail giant has also closed a number of branches in Kenya, where it is headquartered.

The auctioning which started with the perishable goods started on Tuesday and still ongoing.
“The clearance sale has started with Bugolobi branch today. After, we move to Kamwokya branch as we continue talks with the client,” URA tweeted on Tuesday
The URA says it will advertise auction dates for supermarket’s non-perishable goods soon.
The Kenyan based retail giant reportedly failed to come up with a clear payment plan for the tax arrears covering period of over five years. To mitigate the loss, URA says, it had to start the auction immediately to recover tax arrears.

Nakumatt is sailing in a sea of debts. Already 11 suppliers have filed suits at the High Court in Kampala, demanding a combined Ugx. 4.7 billion.
Some of the major creditors include: One to One Finance Uganda Ltd, 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.
Across in Kenya, court last week gave the struggling retailer a lease of life by issuing a blanket blocking creditor from attaching Nakumatt’s property until the insolvency suits have been determined.

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According to the East African, Nakumatt’s landlords—High Park Mall (Highridge), Thika Road Mall, Integer Limited (Uhuru Highway) and Highport Properties which has leased six go downs to Nakumatt—have all attempted to push the distress button on Nakumatt since March, before the court intervened.
The two insolvency suits were filed by tissue manufacturer Africa Cotton Industries and tea processor Gold Crown Beverages.
NIC Bank also commenced recovery processes against Nakumatt, after instructing auctioneers to sell two generators located at its City Square branch near City Hall. The retailer however denied auctioneers entry into the supermarket.

Meanwhile former employees of the struggling Supermarket have petitioned the minister of Trade Hon. Amelia Kyambadde and the Kampala Commercial Officer seeking to recover their savings with the in-house Savings and Credits Cooperative Society (SACCO) worth Ugx. 500 million. The SACCO was started in 2009.
In their 4 September, 2017 petition, the former employees want the minister to summon the SACCO directors to explain whereabouts their money that was deducted from their monthly salaries since 2009.

“Apparently, the mother organisation [Nakumatt] which was trading as a supermarket is in its closing stages due to lack of operation finance…the SACCO was being administered by a committee comprising of mainly Kenyan managers whose future stay in Uganda is probability and our funds as members are at great risk and efforts to recover them almost impossible,” the petition to Ms Kyambadde reads in part.

READ:Nakumatt main store- Oasis Mall closed over 300m tax arrears

Sowedi Mubajje, one of the petitioners says they have failed to access their savings because whenever they apply, the SACCO managers claim that the money is not available.
He adds: It’s money that was chopped from our accounts. We are not asking for unpaid salaries but we want the money that we saved with the SACCO.

READ: Untold story of Shoprite Naalya

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