Kenya’s Commercial Court Judge Francis Tuiyott gave a restraining order to creditors’ intention to sell assets of struggling retailer Tuskys Supermarket.
Through their lawyer, advocate Patrick Ogola, the retailer under a certificate of urgency sought orders against the continued attachment of its properties and freezing of its accounts by various creditors.
“Having read the affidavit of Patrick Ogola sworn on October 16 2020, I hereby order a stay of any attachment, sequestration, distress or execution against the property of the company pending directions that are to issued on 27th October 2020. However this order does not affect Greenspan Ltd,” Justice Tuiyott said.
According to the retailer, it would suffer irreparable losses that would dampen efforts to turnaround Its fortunes and settle debt owned to its trade partners.
“The mentioned acts of attachment will have a devastating effect on the applicants’ ability to service its debt in line with settlement agreements it has already entered with over 300 creditors and will also collapse the arrangements for capital injection in the amount of Ksh 2.1 billion that is in the last stage of finalization,” Tuskys said.
“The preservation of assets is in the best interest of the entire body of creditors many of whom may not receive any payments if the applicant’s assets are stripped through the illegal and imminent acts of attachment, execution, sequestration and distress,” Tuskys added.
In September, the High Court stopped the auction set up for Tuskys Mall Greenspan following KSh30 million rent arrears.
Hotpoint Appliances Limited filed a petition to declare the cash strapped supermarket chain insolvent. Consequently, they seek to have the retailer liquidated in efforts to recover over KSh100 million owed for the supply of electronics.