Since then, Tuskys has closed some of its stores in Uganda, opened others in Kenya, and subsequently closed three stores in Nairobi (ostensibly a temporary measure, but nobody thinks so). Its problem is that it now finds itself being squeezed by three well-funded, expansionist players in its core Nairobi market: Naivas, Carrefour and Quickmart. Back in October 2019, it sought Sh1bn ($9.4m) to pay suppliers so it could get back on more favourable pricing – meaning it has been taking on its competitors while on reduced margins.

Tuskys has several problems: its ownership dispute makes it unattractive to investors. It is clearly carrying significant debt and if the Nakumatt example is anything to go by, its declared debt may be a fraction of its actual debt. It has been talking about going public since 2015 and has sought a strategic investor since August 2019.

As with Nakumatt, the lack of investor candidates is telling. It is starting to suggest that there is almost no price which would make Tuskys an attractive investment. Bear in mind that from 2016, when Nakumatt started to collapse, to last year, Tuskys was the market leader in Kenya.

There are more similarities between the two retailers, who briefly talked about merging in 2017. Nakumatt, and Tuskys (and Naivas) share a common heritage dating back to the time of Mangalal Shah and Joram Korau (founders of what became Nakumatt and Tuskys), who were friends and business partners. The Shah family were early mentors for and investors in Tusker Mattresses (now Tuskys).

It’s not a given that Tuskys will collapse. But we think there is a good chance that it will end up closing, its assets sold and the brand is no more.

Without outside investment, Tuskys faces a considerable uphill battle to regain traction in what is a far more competitive market than 2016. The difference between now and 2016 is the quality of investment and retail expertise behind Carrefour, Naivas and Quickmart. In four short years, the supermarket retail sector has become more sophisticated and hostile. One of the big lessons of the Nakumatt and Uchumi collapse is that consumers were happy to transfer their purchasing to less known retailers.

It is possible that Shoprite, which has permanently closed one of its four stores, might also exit as a result of the same pressure. For Trendtype, the key question is what Shoprite does next. Its exit will do little to support Tuskys – no debt relief, others are better place to pick up the business.

We do not believe Shoprite will invest in Tuskys. But it may choose to pick at the bones of the Tuskys business, especially outside Nairobi, and acquire some strategic sites. Some of the Tuskys store estate will be unattractive: too small, too badly sited. But among its 61 stores there are around 15-20 strategic sites that are worth competing for, and many others that are interesting to retailers like Quickmart who are positioned at a lower end middle class customer and already operate with smaller sites.