Parliament calls for special audit into Quickmart share sale

Questions are now emerging over the Quickmart share sale, with calls for an urgent special audit into the recently concluded initial public offering (IPO).

The calls for a special audit into the sale of shares in supermarket chain Quickmart came just days after the supermarket chain concluded its Sh15 billion IPO priced at Sh7.50 per share, with expectations of a debut on the Nairobi Securities Exchange (NSE).

The matter arose during a session by the National Assembly Public Investment Committee on Commercial Affairs and Energy chaired by Pokot South MP David Pkosing, where concerns were raised that Kenyan investors could lose their money.

Consequently, the MPs challenged the Capital Markets Authority (CMA) to strengthen its market regulation framework to enhance protection of Kenyans from suspect investment offers.

Pkosing led the committee in issuing the directive, citing recent concerns from various quarters over transparency and scope of public education on the Quickmart supermarket chain offer.

The matter arose when CMA, led by the chief executive Wyckliffe Shamiah, appeared before the committee for review of the agency’s audited financial statements between 2018-2019 and 2024-2025 financial years.

The committee said it was important for CMA to put in place measures to safeguard Kenyans from potential loss of investments, citing recent failures of supermarket chains such as Nakumatt and Tuskys.

“How did the regulator approve the Quickmart share sale despite what they described as a troubling history of supermarket failures in the country?

"There should be a special audit to unearth how the deal was structured, with a view to establishing whether the interests of small Kenyan investors are protected. It is aimed at testing whether the transaction is a scheme to drain the economy and bring Quickmart down,” the committee stated.

Kaloleni MP Paul Katana told CMA that it had "taken advantage of Kenya's ignorance", citing the collapses of Nakumatt, and warned that Quickmart was next if not cushioned.

"You allow Kenyans to invest in companies that are running down," he said, demanding to know what the CMA had done that Kenyans could take note of. "Kenyans are crying, hurting."

Nairobi County MP Esther Passaris also questioned the implications of the Quickmart Supermarket chain’s public share offer, wondering whether Kenyans had been adequately protected and sufficiently informed about the financial realities underpinning the transaction.

The offer attracted applications worth Sh18.41 billion, representing a 22.7 per cent oversubscription.

“There are concerns that the proceeds would go to the selling shareholder rather than Quickmart itself, meaning the retailer would not receive fresh capital from the transaction,” Passaris said.

The transaction has also been termed a partial exit by private equity investor Adenia and the company's founders, raising questions about what investors stand to gain and the risks they assume.

 Pkosing insisted on the need for CMA to have keen scrutiny of the matter, regretting that Kenyans have previously lost millions after similar share offers relating to Supermarket chains.

“As the market regulator you have an obligation to protect Kenyans from potential loss of funds. You have the capacity to seal all these loopholes, and your biggest risk that needs your immediate attention appears to be these supermarket chains shares offers,” noted Pkosing.

The committee's concerns centred around Quickmart's financial position, operating cash flows, supplier obligations and the disclosures made to prospective investors.

Shamiah acknowledged that investor protection was an issue, but sought to draw a distinction between listed supermarkets and those that had collapsed, but confirmed that the CMA approved the Quickmart share sale.

"Some of them are supermarkets which are not under us. They were not listed. The House needs to think how they can be regulated. Tuskys and Nakumatt never floated shares to the public," the MD said.

He insisted that CMA had undertaken thorough review of the Quickmart shares offer, and was convinced of its feasibility.

“The bulk of its funding is internally generated. The proposed share sale has also met the other requisite thresholds,” the CMA boss said.

But Pkosing asked, "Has it come to your mind that this is robbery? Friendly fire kills, so even this soft robbery is robbery. Ever thought that they are floating shares to liquidate then shut doors?"

Soy MP David Kiplagat noted that the committee had given the CMA a chronology of supermarket collapses and warned that it would be hesitant to move on unless the concerns were acknowledged.

Pkosing asked whether it was possible for the investors to get insurance.

"As MPs we are the direct representatives. If you see us worried, the people are also worried. If you have no legal instrument to support your work, let us know.

"Your biggest risk is in the supermarket segment. As a regulator you can't sit comfortably in the office. It is a matter of time. Once they recoup their money they will go."

Shamiah responded that the committee's concerns were being taken seriously.

"I take what the committee seriously says about the lessons that we need to protect Kenyans. We don't have all the facts. We will obtain this information," he said.