Foods company Twiga has bought out three distributors amid accusations of implementing a "soft liquidation" strategy
In the heart of Kenya's bustling digital commerce and agritech sectors, Twiga Foods, a global trailblazer in streamlining food supply chains, finds itself at the centre of a storm. The company, founded in 2014 and recognized for its innovative digital approach, has recently been under scrutiny due to a series of acquisitions and questionable governance practices.
Charles Ballard, a former executive from Jumia Kenya, has taken the helm as the new leader of Twiga Foods. However, his tenure has been overshadowed by concerns about the company's financial health. A report by local tech publication Tech-ish has shed light on these issues, raising red flags among stakeholders.
The report alleges that Twiga is actively engineering a soft liquidation strategy, restructuring operations under a newly incorporated entity internally referred to as "NewCo." Despite the company's strong funding history, with investors including Goldman Sachs, IFC, and Creadev, the whistleblower suggests that the company remains stuck in a manual, outdated grind.
Twiga Foods has acquired majority stakes in three local distributors: Jumra, Sojpar, and Raisons. These acquisitions are expected to bolster Twiga's procurement capabilities and extend its national presence across the Central, Western, and Coastal regions of Kenya. However, the whistleblower claims that the restructuring is designed to avoid significant obligations, including commercial leases, employee severance packages, and unpaid vendor bills.
The allegations against Twiga include micromanagement, operational inefficiency, and alleged racial bias in hiring practices. The whistleblower alleges that Twiga has fired most of its staff, gutted salaries, and bled the company dry. However, it is important to note that no verifiable information in these search results confirms any financial difficulties, soft liquidation, or restructuring plans at Twiga Foods in Kenya.
The road ahead for Twiga may depend less on its strategic ambitions and more on whether it can restore trust among staff, suppliers, and investors alike. The company's founding CEO, Peter Njonjo, stepped down in early 2024, and it remains to be seen how Ballard's leadership will navigate these challenges.
Twiga's recent acquisitions are part of a wider trend in Kenya's digital commerce and agritech sectors, where companies are diversifying their revenue streams amid tightening capital markets and rising operational costs. As the dust settles, Twiga Foods will need to address these allegations and work towards rebuilding its reputation.
Technology remains pivotal in Twiga Foods' operations, underpinning its digital approach to streamlining food supply chains. However, concerns about the company's financial health and restructuring strategies, as raised in a Tech-ish report, could potentially impact its technological advancements, especially concerning the engineering of a soft liquidation strategy and being stuck in a manual, outdated grind.
