A liquor store operator is seeking Sh4.5 million compensation from Uchumi Supermarkets, claiming he was ejected from the retailer’s Lang’ata Hyper branch to pave the way for China Square without notice and against a court injunction.
Dominic Mwangi, who was operating a liquor store under Grand Liquor Suppliers & Esteem Gas Supplies, says in court papers, Uchumi disregarded a May 8 court order, stopping it from leasing out the 100,000 square feet space pending the hearing of a suit in which he claimed to have been unlawfully removed from the premises.
“The defendant acted contrary to the court order by letting out the premises to a third party,” says the suit.
China Square, which deals in household goods, leased the Lang’ata Hyper branch from Uchumi and said it made an investment of Sh600 million as it sought to capitalise on the busy off Lang’ata road complex.
The shop opened mid-June as Uchumi took over the smaller unit that has now attracted the lawsuit.
Mr Mwangi is seeking Sh4.5 million compensation made up of Sh300,000 monthly rent accrued from June 7 and Sh3.6 million, being one-year rent for what he terms as unlawful eviction against the court order issued in May.
He is also seeking the jailing of Uchumi Chief Executive Lawrence Ngao and chairman John Karani for up to six months for disregarding the court order.
The liquor premise was located just outside Uchumi Lang’ata Hyper but was demolished as China Square came in. Uchumi then renovated the premises to start its own business, mainly on fresh produce.
Mazars Consulting Ltd, the firm supervising Uchumi’s company voluntary agreement (CVA), said in March this year there have been some positive developments in the retailer’s recovery strategy, noting that the financial viability of Lang’ata Hyper was hinged on getting a new tenant.
According to the Mazars, Uchumi’s unaudited financial records showed the retailer was averaging Sh5.1 million sales per month between July and December last year compared with an average of Sh3.03 million in 2022. This translates to a 68 percent growth.
Uchumi late last year also managed to sell three acres of the 20 acres it had intended to sell in Kasarani. The transaction was at Sh401 million, leaving it with net proceeds of Sh351 million and thereby making available the much-needed funds for operations.
The money gave the retailer a breather as it continues to pursue the sale of the remaining 17 acres in Kasarani, in what will be a major breakthrough in stabilising its operations. However, it must first overcome the legal tussle with Kenya Defence Forces, which claims to own the land.
