Power struggle at Tuskys as CEO says he is in office even after ouster

A power struggle is playing out at Tuskys after chief executive Dan Githua, who was forcibly ejected from the retail chain on Tuesday, insisted that he is still in office even after the board announced that it had appointed one of its shareholders to the same position in acting capacity.

Tuskys chairman John Kago notified employees in a letter sent soon after Mr Githua’s ejection that George Gachwe, one of the retail chain’s heirs, was taking over as chief executive in the interim to ensure “smooth operations”.

Mr Kago on Wednesday confirmed to the Business Daily that his younger brother had taken over stewardship of the retail chain “pending investigations” into Mr Githua’s conduct.

“He has stepped aside pending investigations. Director Gachwe will hold office in the interim,” Mr Kago said in an email. 

Mr Githua, who has been Tuskys chief executive since May, however, insisted in an interview that he is still in charge, adding that the individuals who ejected him from his Embakasi head office lacked authority to do so.

“My appointing authority is John Kago the chairman, I have not seen any communication from him (regarding the alleged sacking or stepping aside), he is officially the linkman between me and the board and I’m therefore waiting to hear from him,” said Mr Githua in an interview, adding that he was still discharging his duties as CEO.

He said that he is also yet to receive any news regarding his replacement.

On Tuesday morning Mr Githua was mobbed by some of the 20 grandchildren of the late Tuskys family patriarch Joram Kamau (the retailer’s founder) and dramatically frog marched out of his office and into his car.

READ: Retailer Tuskys in turmoil as owners eject chief executive

They accused him of hiding the fact that he was the majority owner of a company that currently recruits the retail chain’s employees, poor performance and exuding “disrespect and arrogance” towards its owners and staff.

Mr Gachwe was in August 2014 appointed the Tuskys chief executive, a position he held until Mr Githua replaced him in May 2015.

The board chairman fell short of admitting that Mr Githua’s sacking letter dated January 23 was not legitimate, since he had not signed it.

The letter was signed by four people, two of whom (Yusuf Mugweru and Mary Njoki) are shareholders of the company. Tuskys declined to disclose exactly who constitutes its board.

The business is owned by seven siblings including Mr Gachwe, Mr Kago, Mr Mugweru, Ms Njoki, Mr Gatei, and Stephen Mukuha and Mary Njeri who is deceased.

“Mr Githua’s alleged sacking letter was not a unanimous decision of the board,” said Mr Kago.

The besieged Mr Githua also denied charges that he holds a majority stake in Artemis Sourcing, a company which currently recruits Tuskys’ staff, placing him in direct conflict of interest.

He, however, acknowledged that the firm is partly owned by James Ouma, chief executive at Speed Capital, which Mr Githua co-founded seven years ago and still partly owns.

He added that Mr Ouma holds these shares in his personal capacity, and not as his proxy as alleged, and that he was, therefore, not breaching corporate governance guidelines.

“After becoming CEO in May, I wound up my company Artemis Africa with full disclosures to Tuskys management,” said Mr Githua. “Artemis Sourcing was formed by other directors and they were subsequently engaged by the Tuskys board without my involvement.”