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Wednesday, June 07, 2006

What Was Chris Kirubi’s Role In The Collapse Of Uchumi?

Mr Chris Kirubi, embattled former Chairman of the board of the collapsed Uchumi Supermarket chain

Who is Chris Kirubi? What sort of a person is he? (This is a significant question because character is essential for anybody running a public institution, let alone the chairman of the board). How did he make his current fortune? What was his role in the collapse of Uchumi?

I have deliberately put these questions together because they are related.

It is amazing what short memories Kenyans have. I will not make any claims or wild allegations but will instead present a few facts.

Chris Kirubi did not inherit his fortune. During the coffee boom 1975/1976 when many Kenyans made millions smuggling coffee from chaotic Uganda at a time when Brazilian coffee had been heavily hit by frost thus pushing world coffee prices to an all time high, Chris Kirubi was a mere employee of a parastatal transport company known as Kenatco.

Without making any wild allegations, before the coffee boom Mr Kirubu was a penniless ordinary employee of Kenatco. After the coffee boom, he emerged an extremely wealthy man. He used his connections and friendships made during the coffee boom to clean up and enhance his image. Foreign companies coming into Kenya looking to appoint a director with their ear to the ground and good reliable powerful contacts had turned to Chris Kirubi in increasing numbers and in no time at all he was "Mr Clean". Meanwhile this shrewd unschooled man picked up all he could from the many boardroom appearances he made, the rest as they say is history and today he is one of the wealthiest and most powerful men in the land. But now it seems that his past is rapidly catching up with him.

The key question to ask here, is what were Mr Kirubi's priorities and loyalties when he was appointed chairman of the board at Uchumi? Were they to further enhance the well-being of this public company or was it to consolidate his own personal interests?

The government should instigate a full enquiry into the circumstances that led to the collapse of Uchumi and we will see to who's door step most of the blame leads. This is serious matter because Uchumi was not somebody’s family business.

This blogger's policy is never to make wild unsubstantiated claims that cannot be proved and in the instances when I cannot resist the temptation of doing so, I label them as such. However the truth is that whilst we may laugh and look down on small retails traders and dukawallas, the truth is that there is no corporate sector that calls for more specialist knowledge than the retail business (an MBA only, is the worst possible qualification for a supermarket CEO to have - just ask Nakumatt). Reading the biography of Sam Walton and Walmart will make this truth come out very clearly for anybody. Inspite of Sam Walton’s vision and genius, the great American supermarket chain was in deep debt for many years.

My bet is that it will be found that Uchumi Spermarkets was thrown to the wolves, that is a group of people struggling to be the ones to gain the most personally from this national asset and non of them had the faintest idea of what the business was all about.

This blogger hereby joins the growing list of Kenyans asking that the government step in and halt the collapse of Uchumi.

My suggestion is that the man who understands this company more than any other Kenyan I know, Suresh Shah be re-appointed managing director and that the government gives the supermarket chain a soft loan to get things going again, even as a full public enquiry is instituted.

(Read next post to see how Uchumi was run in its' golden hey days.)


posh said...

Your judgement on Kirubi is far too harsh. Yes Uchumi failure started during his tenure but I refuse to buy into the premise that a major shareholder can steal from himself.
You appear good on research seeing what you stated on Suresh. Do the same objective research on Kirubi and you will realise a DIAMOND of a man who has succeeded more than he has failed.

VituVingiSana said...

@posh - Unless proved otherwise the consensus is that kirubi wasn't stealing from himself but the shareholders. A majority shareholder can supply goods at inflated prices THUS by owning 25% of Uchumi he gets 100% of "extra" profits thus adding 75% to his own pockets.

In addition, Haco Industries (kirubi's flagship) was probably a major supplier to the detriment of other more competitive suppliers. I would like to know how much kirubi & co (friends & related entities) were owed when Uchumi collapsed. I bet his firms were paid off within 30 days while others had to wait!

Who are the landlords for the numerous Uchumi locations?

See further questions/comments at &

Kenyanghost said...

Chris sold out his shares long before the collapse , he knew something for sure

Kenyanghost said...

any body knows the relatin betwwen Kirubi and Bruce McKENZIE

Kenyanghost said...

hey this is stressing me,

Kenyanghost said...


Anonymous said...

The truth be told, it is not the first time major investors have brought down a company used insuder knowledge to know when to bail out, leave other share holders with no other choise but to sell bad stocks, then the same major investors buy the stocks for a song reaquire more stockholdings revamp the company, the previuos share with a higher control and profit share, that is where Uchumi was headed so that some people could steal a public company legally

sir said...

@Posh When you say that Kirubi can't steal from himself i would say that he wasn't stealing from himself but from the shareholders. If whatever you are saying is true how did he end up being a majority shareholder. He didn't inherit a fortune..That calls for much.Don't you think So?

Anonymous said...

Chris Kirubi is innocent. Guys, please do some serious research, and most of all, get to know the man before making any accusations.
If selling shares because he realised that his fellow shareholders weren't listening to him is a proof that he knew something for sure, then yes he did. What would you do?
Don't assume things...make sure!

Anonymous said...

Very much so agree with most comments. You sound so bitter that this self made tycoon has made so much of himself. I greatly admire him for talking all those risks. Remember no one is perfect and the nature of a business is unpredictable, one time you are up and the next you are down. Being subjected to failure at one several times in life does not make you a thief or a fraud. Maybe he stole maybe he didn't but it should be recongnised that this man created jobs fed families and has been part of the Kenya revolution in different levels. So accuse all you want, he made his billions and still is. Kirubi is extremely brilliant and would love to learn from him.

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