Questions over Uchumi Supermarkets' recovery plan took centre stage in Parliament after the retailer defended its efforts to pay former employees and other creditors while lawmakers demanded answers over delays in implementing the Court-approved Company Voluntary Arrangement (CVA).
The matter came up before the National Assembly's Public Petitions Committee on Tuesday during a hearing on Public Petition No. 9, which was lodged by former employees who accuse the retailer of failing to fully meet the promises made under the Court-approved arrangement.
The committee, chaired by Runyenjes MP Muchangi Karemba, heard submissions from Chief Executive Officer and Managing Director Lawrence Ngao, Board Chairman John Mwara, Company Monitor Owen Koimburi and Company Secretary Judith Matoto.
During the session, the Company Monitor told lawmakers that by April 2026, nearly 85 per cent of the payments expected under the CVA had already been made. He added that the company remains focused on settling the remaining balances owed to former workers and other creditors.
Committee members were also informed that progress in clearing the outstanding obligations has been slowed by a legal dispute involving about 17 acres of land belonging to Kasarani Mall Limited, a wholly owned subsidiary of Uchumi Supermarkets PLC.
Lawrence Ngao explained that the land is occupied by the Kenya Defence Forces and is also the site of an Affordable Housing Project being undertaken by the Government. He said this has denied the company an opportunity to unlock the value of the property and use the funds to support the recovery process.
"As a result, the Company has been unable to realize the value of this strategic asset, which was expected to significantly contribute to implementing the CVA and to accelerate payments to creditors," said Mr. Ngao.
He further told the committee that the company has moved to court to protect its interests and that the case is now before the Court of Appeal. According to him, the Attorney General, the Ministry of Defence and the Kenya Defence Forces are among the parties involved in the case.
Officials also disclosed that the disputed property is valued at more than Sh5 billion, saying the company would be in a stronger financial position to clear the remaining debts once the asset is realized.
Even so, the committee raised concerns over the way the recovery programme is being managed, especially after the Company Monitor claimed he had been left out of important decisions affecting the business.
Committee Chairperson Muchangi Karemba questioned why the Board proceeded with major decisions, including opening new branches and implementing Board resolutions, without involving the monitor, who is expected to oversee the implementation of the CVA.
"The monitor says he was not briefed on the opening of new branches and has repeatedly sought updates on the implementation of Board decisions without success. He also says he has not been provided with records of cash flow application, despite creditors resolving that surplus cash should be applied only to creditor settlements, with the joint approval of the Board and the monitor. Given these concerns, there appears to be a governance pattern in which the Board has not consistently sought or waited for the monitor's advice. Why did you proceed with these actions without involving the monitor?" asked Hon. Karemba.
Responding to the concerns, Board Chairman John Mwara rejected claims of disagreement between the Board, management and the Company Monitor, saying they have continued holding discussions aimed at improving coordination and resolving the remaining issues.
"I would like to correct the perception that there has been a tug-of-war among Uchumi management, the Board, and the monitor. That is not correct. We have remained in constant engagement. Last month, the Board and the monitor met and agreed to develop a strategy before holding a joint meeting to address outstanding issues, better understand each other, and establish a workable framework," said Mr. Mwara.
The Public Petitions Committee will now examine the submissions presented by all parties before compiling and tabling its report in the National Assembly.