19/11/2022

EXAMPLES OF KENYAN FAMILY

BUSINESSES THAT COLLAPSED

1. TUSKYS
• Some of the reasons that contributed to the collapse of the multi-billion
supermarket which had several branches in major towns include sibling
rivalry, internal fraud, aggressive debt-fuelled expansion and fierce
competition.
• By August 2020, it had accumulated debt worth KSh 6.2 billion owed to
suppliers and creditors. Despite entering a KSh 2 billion agreement with a
Mauritius firm to ward off financial constraints, the closure of its last
branch in Nakuru proved to be the last nail on its coffin.

1
 19/11/2022

2. NAKUMATT
• Nakumatt began experiencing serious cash-flow issues in 2016. It was
unable to meet its financial obligations to landlords, suppliers, and staff.
• In June 2018, an audit report revealed KSh 18 billion disappeared under
ex-boss Atul Shah's watch.
• Mismanagement, debt and uncontrolled expansion sank the retailer.

3. ARM CEMENT
• Founded in 1974 by Harjivandas J. Paunrana, now late
• Was one of East and Central Africa’s largest cement producers
with operations in Kenya, Tanzania, Rwanda and South Africa
• Pradeep Paunrana took over from his father and embarked on expansion
• Debt and mismanagement drove ARM into administration in August 2018

2
 19/11/2022

4.SPENCON
• Spencon was a huge construction company founded in 1979 by Jitendra Patel.
In the 1980s and 1990s, it had operations in Kenya, Tanzania and Uganda,
India, and Zambia, Malawi, Mozambique, and Southern Sudan with a strong
5,000 workforce.
• In 2009, Emerging Capital Partners (ECP) invested KSh 1.5 billion into the
company and used it to take 37.4% of the company. The construction
company ran into financial woes five years after ECP bought the shares.

5.AKAMBA BUS COMPANY

• The Akamba bus, established by Sherali Hassanali in Machakos county, was once a formidable
player in the transport industry with a network spanning over 50 destinations.
• Sherali later died in September 2000 leaving behind the company to his wife Zarina and sons,
Moez and Karim.
• The two brothers could not replicate their father’s success and the company collapsed in
2012.
• The causes of the crumble include board room wrangles, family disputes. Escalating fuel prices
and recession.