The firm incorporated as the Tusker Mattresses Limited has since withheld its much-awaited public listing by at least a further 18-months as management seeks to put its house in order ahead of the activation of the rigorous Initial Public Offer (IPO).
According to Tuskys Chief Executive Officer Dan Githua, the strategic investor is expected to guide the company’s expansion strategy into the region to incorporate additional capital injection and the development of an employee-ownership plan.
“The first thing would be to improve our internal governance structure. We would need to ensure that our structure can withstand public scrutiny upon listing. Our goal would be to present a well-capitalized company to investors as we wouldn’t want to be confronted by the suggestion that we are only listing for money,” he said.
The retail giant first hinted at a possible NSE listing in mid-2016 with a keen eye on regional growth having taken attraction in the growing regional retail opportunities highlighted by the rising disposable incomes of the nearly 300 million participants in the East African market.
The supermarket, which has humble beginnings in the present day Nakuru County, has grown from a standalone entity in the small town of Rongai to incorporate 65 branches in both Kenya and Uganda with a staff stock of over 6000 employees and nearly 800 independent suppliers.
The family-owned supermarket has however been the subject of heated internal wrangles tainting the stability of the firm’s management most recently as five heirs to the business faced off for the control of the company.
Tuskys management has ceded the daily operations of the supermarket away from family ties in the aftermath with seven general managers currently overseeing the day to day running of the business.
Expansion by the retailer has involved the leveraging of e-commerce having launched its online trading platform on the back-end of 2018 in response to the changing customer choices and preferences under and growing digital economy.
Tuskys is currently exploring a franchise model to its regional expansion goal with a keen eye on its existing partnership with Vivo Energy across the region.
The partnership has already seen Tuskys setup convenient outlets at Shell branded service stations along major highways in Nairobi and its environs.
CEO Dan Githua expects the firm to employ a similar strategy to spreading its wings in the Ugandan market denoting the high stock turnover of its small-sized retail outlets in its home country.
Tuskys has in the lack of a public listing enrolled to the NSE Ibuka program and in essence ends hope for a 2019 IPO.
This comes on the back of Vehicle and Equipment Leasing Limited (VAELL), the second expected listing on-boarding to the alternative acceleration hub which seeks to give investor visibility to firms without requiring the entities to list publicly.
Investments firm Cytonn which makes for the third and final rumored listing its still tip-toeing around the public disclosure option with CEO Edwin Dande informing Citizen Digital of ‘a work in progress’ at this stage.
The lack of applications for a public listing at this point in 2019 has however not dented the enthusiasm of the NSE with the trading house CEO Geoffrey Odundo expectant of a subsequent listing conversion from the pool of Ibuka entries who currently stand at 15 in number.
“It would be premature to pin a date to the next IPO. We are embracing flexibility to enable firms in the accelerator program to feel adequately prepared,” he said.
“What we are keen on is to get quality listings. There would be no point of bringing new companies to the NSE in a rush only to see them die off in a few months. Many companies need to go through an incubation to validate their readiness for listing”
The NSE has been without a substantive IPO since its self-listing in 2014 with the only other substantive listing being CIC Group public offer in 2012.
The NSE most recent additions in its differentiated Alternative Market Segment (AIMS) and Growth Enterprise Segment (GEMS) have hit a snag as the majority of enlisted firms find themselves in financial and corporate governance troubles.