Battle royale as Naivas shares lawsuit starts
A Naivas Supermarket outlet on Muindi Mbingu Street in Nairobi on October 10, 2021.
The tussle for the ownership of Naivas will play out in court today as proceedings open in Nakuru in a bitter family feud over the multibillion-shilling retailer.
Mr Newton Kagira Mukuha, the eldest son of Naivas founder, Peter Mukuha Kago, has appealed a High Court decision that dismissed his bid for a stake in the retail chain.
Mr Kagira has accused his siblings of locking him out of the business yet he reportedly contributed 20 per cent seed capital during its inception in 1990.
He wants the Court of Appeal to determine whether the ownership of Naivas should be based on the original capital contributors while the business was starting or current owners as listed by the Registrar of Companies.
Mr Kagira also accuses his brother, Mr David Kimani, who is the current managing director, of teaming up with his other brother, Mr Simon Gashwe, to de-list him as co-owner, thus denying him his rightful stake in the business. Since Mr Gashwe has since died, Mr Kagira has listed his son Charles Mukuha, who is the current representative of the estate of his father, as the respondent.
Mr Kagira moved to the Court of Appeal in August 2021 under a certificate of urgency after his previous application claiming ownership of the business was dismissed by the High Court.
In November 2021, he secured orders stopping further sale of a stake in the business after it emerged that the supermarket had sold a 30 per cent stake to the International Finance Corporation (IFC, the private lending arm of the World Bank), private equity firms Amethis and MCB Equity Fund as well as German sovereign wealth fund DEG for Sh6 billion in exchange. Last month, it emerged that French sovereign wealth fund Proparco had acquired a $31.5 million (Sh3.7 billion) stake in Naivas as part of a consortium that will take a combined 40 percent ownership in the retailer.
They are taking up stakes owned by a consortium of investors that include IFC, MCB Equity Fund, Amethis, and DEG. The orders sought by Mr Kagira were issued by Court of Appeal judges Daniel Musinga, Hannah Okwengu and Asike Makhandia.
Naivas directors are Mr Kimani, who owns a 25 per cent stake, Mr Gashwe (25 per cent), Ms Linet Wairimu (15 per cent), Ms Grace Wambui (15 per cent) and Mr Kago (20 per cent).
Mr Kagira argues in court that the true ownership structure of Naivas should include his 20 per cent, 30 per cent shares owned by their deceased father, Ms Wambui (25 per cent), Ms Wairimu (15 per cent) and Mr Kimani (10 per cent).
