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From village grocery to giant chain: The rags-to-riches story of Naivas

Naivas Supermarkets, whose chairman Simon Gashwe Mukuha died on Monday, started as a shop in a tiny village in Rongai, on the outskirts of Nakuru town.

The giant supermarket started as Rongai Self-Service Stores.

The rags-to-riches tale of one of the country’s leading supermarket chains would not be complete without the mention of Nakuru, where it sprang up as a small family shop.

Naivas founder Peter Mukuha Kago died in 2010 and left Mr David Mukuha, Simon Gashwe Mukuha and his other children to run the business.

The other family members who have shares in Naivas are Ms Grace Wambui Mukuha and Ms Linet Wairimu.

Gashwe was the administrator of their father’s estate.

In a past interview with the Nation, Mr David Mukuha talked of the humble beginnings of the giant retail.

“It first started as a small family business serving Rongai in 1992. I convinced Gashwe that this type of business held our future. We raised Sh200,000 and used it as capital,” Mr Mukuha said.

Rongai Self Service Stores grew into a wholesale and distribution business and was registered as a company in 1993.

Two years later, the business opened a branch in Elburgon, near Molo.

TUSKYS CONNECTION

The Mukuhas then ploughed back profits from the business and opened another branch in Naivasha, which they called Naivasha Self-Service Stores.

The Naivasha branch was the headquarters of the family business. It later rebranded to Naivas.

In 2001, the business spread its wings to Nairobi, opening a branch on Ronald Ngala Street and closing the Rongai and Elburgon outlets.

With time, Naivas Ltd established itself as a reputable chain of supermarkets.

Naivas has branches in Nairobi, Naivasha, Eldoret, Machakos, Embu, Kitui, Garissa, Narok and other towns across the country. It employs hundreds of people at its outlets.

Nakuru is also home to at least four dominant supermarket brands, including Tuskys.

Interestingly, Tuskys also traces its roots to a small grocery in Rongai. Its founder Joram Kamau set up a shop called Magic Super Store in the 1970s.

The shop, which morphed into Tusker Mattresses, opened a supermarket on Pandit Nehru Street in Nakuru town and another on Mfangano Street, Nairobi. It later grew and rebranded to Tuskys.

FAMILY LINKS

It may not be known to many but Mr Kamau and Mr Mukuha were brothers.

Tuskys recently announced a three-year plan to increase its branches in Kenya and Uganda to 100. It currently runs 64 retail outlets.

Others that have origins in Nakuru are Nakumatt, founded by Has Hashmuk Shah and Haraka Kanini Enterprise, which deals in retail and wholesale.

The latter traces its beginnings to Kinangop, from where it shifted to Nakuru town. It has branches in Thika, Meru, Narok, Engineer and Naivasha.

Gilani’s, Stagemart and Rivanas Supermarkets were also started in Nakuru.

Mr Peter Mukuha Kago’s demise in 2010 exposed a split in the family that ended up in court.

The case began in August 2013 when Massmart, a South Africa-based subsidiary of Walmart, offered to acquire a 51 per cent stake in Naivas at Sh3 billion.

BUSINESS TUSSLE

Mr Kago’s eldest son, Mr Newton Kagira Mukuha, sued and asked the court to block the sale of the controlling stake in Naivas to the South African firm.

Mr Kagira said he was entitled to 20 per cent of the sales proceeds as part of his inheritance.

He also sought to be recognised as a heir of the multibillion-shilling supermarket chain, but lost the case on October 10, 2016.

The High Court dismissed his objection to a will written by his father. Justice Anthony Ndung’u said Mr Kagira’s opposition to the will had no grounds and directed that the assets be distributed according to the will written on March 20, 2010.

Mr Kagira filed the case in 2013, claiming his siblings hijacked the family business and excluded him from the list of shareholders despite contributing to the seed capital to set up the giant retail chain.

He said his brothers and sisters were out to disinherit him and opposed a will that was produced in court.

He instead produced a parallel will, saying the one given by his siblings was not genuine.

The court, however, found that Mr Kagira had no stake in the retail chain, having run down all other stores he inherited from his father.