Troubled retail chain Uchumi Supermarkets #ticker:UCHUM has informed the capital markets regulator of the ongoing land dispute between it and the Kenya Defence Forces (KDF), even as it maintains that it holds the original title deed to the prime parcel on Thika Road.
KDF has occupied the 20-acre land even before resolution of the ownership tussle. The land in Kasarani, adjacent to the Thika Road Mall, is valued at an estimated Sh2.8 billion.
The Nairobi Securities Exchange-listed retailer has also hinted that it is ready to move to court to defend its claim to the land.
“All options are being weighed at the moment. We are not at liberty to disclose status at the moment,” said Uchumi in a statement.
KDF has moved its equipment to the disputed land, creating a standoff with the cash-strapped retailer.
Being a material company asset, Uchumi has informed the Capital Markets Authority (CMA) of the tussle, assuring the regulator that it owns the property.
Public listed companies are required to report and publicise any material changes that could affect their financial position in the interest of keeping investors informed.
“Whereas Uchumi Supermarkets has not formally notified the Capital Markets Authority of any change of ownership relating to its parcel of land located in Kasarani, the company confirmed that it still holds the genuine title deed to the said piece of land,” said CMA in response to the Business Daily queries.
Uchumi says that KDF has not formally informed it about its claim of ownership to the piece of land. “The company further indicated that as and when such claim is made to the company, necessary action would be taken and the relevant stakeholders, including the CMA will be notified.”
However, Uchumi, whose previous attempts to sell the land had hit legal headwinds, added that it is engaging KDF over the ownership dispute.
The retailer has been banking on selling the land to turn around its dwindling fortunes.
“Uchumi Supermarkets Plc has noted with concern reports of the occupation of the company's property in the Kasarani area of Nairobi County by the Kenya Defence Forces (KDF),” said the retailer in an earlier statement.
“Uchumi Supermarket Plc wishes to state that it is the rightful owner of the said property and will defend its property rights within the confines of the law.”
The KDF had, however, dismissed Uchumi’s claims to ownership of the land, maintaining it is the rightful owner.
“The Roysambu KDF Camp is on Ministry of Defence land. The issue of laying claim to a military camp does not arise. The onus is on the claimant to provide evidence,” said KDF spokesperson Colonel Paul Njuguna in response to earlier Business Daily queries.
Uchumi had already signed a sale agreement with a church group, Jewel Complex Limited, which had committed to buy the land for Sh2.8 billion.
Excavation is ongoing on the land, with tents already put up and a perimeter fence erected. Military vehicles used to transport personnel and equipment are strategically located at the entrance. Sand bags have also been placed strategically.
Uchumi Supermarkets last November inked a deal to sell the land at Sh2.8 billion, which offered its suppliers and creditors some hope for payment of their pending dues.