Last week there was a surprising newspaper story that businessman and former MP Harun Mwau had sold his (7.7%) shares in Nakumatt supermarkets.

Businessman John Harun Mwau has sold his 7.7 per cent minority stake in Nakumatt Supermarkets ahead of the retail chain’s plan to take on board a new shareholder with deep pockets to pull it out of a bourgeoning debt crisis.

Late last year, when Nakumatt acquired three stores in Western Kenya they had released a statement which noted that:

Currently enjoying a less than 25% market share of the formal retail space, Nakumatt Holdings, is actively seeking to retain a bigger slice of the mid to premium segment. Through the strategy, the retailer has been working, to grow its gross revenue to over US$1billion in the medium term period while growing its network footprint across East Africa.

Nakumatt has been in the news for the last 6 or 7 years. It was embroiled in the closure of Charterhouse Bank in which it owned 10% and was widely accused of using the bank to launder money and evade taxes. Nakumatt then went ahead and published a lengthy declaration of defense explaining its’ relations with Charterhouse, tax payments (in relation to income), revenue, stores, and compliance with Kenyan law etc.

The new Nakumatt deal comes at a time of unprecedented activity in the retail sector activity both in mall development and supermarket chains.  It also coincides with reports of cash flow issues at Nakumatt, seen in slow payments to suppliers, as have had other supermarket chains, including Uchumi earlier this year.

It is expected that exit of Mwau will lead to another deal at Nakumatt that will bring on board new shareholders, both local or foreign.