Kenyan Clothing Store Deacons Likely to Close Doors
Kenyan Men’s Clothing Store Deacons Likely to Close Doors
(Bloomberg) -- Deacons East Africa Plc’s battle for survival may soon come to an end as the administrators plan to liquidate the clothing retailer after efforts to sell assets and seek a strategic investor fell through.
A report will be filed shortly with the High Court in Nairobi, Kenya’s capital, recommending the company be liquidated, Peter Kahi, from PKF Kenya, one of the joint administrators of the company, said. That’s after it failed to raise 450 million shillings ($4.15 million) to help in its turnaround strategy, according to Kahi.
“Every creditor will take a hit,” Kahi said by phone.
Deacons, which also had operations in Uganda and Rwanda, was placed under administration in November 2018 after it lost its biggest franchise, Mr. Price Group Limited, a South African retailer.
Its only assets are fittings at three stores it previously operated. None of these were sold “as there’s no taker. The landlords want their premises back as rent continues to pile up,” Kahi said.
The company’s liabilities stood at 1.12 billion shillings as at date of administration, according to a January 2019 report by the joint administrators. That includes 387.6 million shillings owed to NCBA Group Plc and 152.8 million shillings due to UBA Kenya Ltd.
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