Britania under administration after default on Sh1.3bn loan

Britania Foods, the manufacturer of biscuits, has been placed under administration after defaulting on loans of more than Sh1.3 billion provided by DTB and other creditors.

Peter Kahi of PKF Consulting was appointed as administrator of the company by DTB which is owed Sh900 million by the manufacturer.

The appointment comes at a time when the biscuit maker has been fighting an insolvency petition filed by one of its suppliers Uzuri Foods which is claiming Sh17.3 million.

Britania was among the leading biscuit brands in the country but has been hit hard by reduced demand from its main distribution system of schools, hotels, restaurants and supermarkets. Its factory ceased operations in October last year.

The administration comes at a time when the biscuit maker has been fighting an insolvency petition filed by one of its suppliers, Uzuri Foods claiming Sh17.3 million.

“The administration appointment was drawn by DTB Bank for its unpaid debt of over Sh900 million. Britania owes over Sh400 million to its suppliers and we will be trying to revive the business and repay the debts. It may not have other bank creditors,” Mr Kahi said.

Last month, Uzuri Foods limited which supplied Britania with flour filed an insolvency petition over a Sh17.3 million debt for deliveries made between March and August 2019.

Uzuri wanted the High Court to appoint Kolluri Venkata Subbaraya as the liquidator and given authority to sell the manufacturer’s assets to recover the debt.

Britania argued that retail giants, Nakumatt and Tuskys collapsed while owing it more than Sh50 million, and that the Covid-19 pandemic has hurt its biggest client base — schools and hotels.

In December 2016, Britania received undisclosed capital injection from UK’s development finance institution CDC through its Nairobi-based private equity fund manager Catalyst Principal Partners.

The capital was to be spent in upgrading Britania’s factory, innovation of new products and diversifying its offering in the fast-moving consumer goods market.

“None of the directors, shareholders, employees and no other person is authorised to transact any business on behalf of the company without express consent from the administrator,” Mr Kahi added.

“Creditors of the company are required to send full particulars of any claims that they may have against the company to the undersigned on or before September 3, 2021.”