Naivas Supermarket has moved to court seeking orders to preserve New Kenya Co-operative Creameries Limited (KCC)’s assets and bank funds over fears that the dairy processor’s planned restructuring could jeopardise recovery of a KSh420 million claim.
In an application filed through its lawyer, Phillip Nyachoti, the supermarket is seeking orders restraining KCC from selling, transferring, charging, leasing or otherwise disposing of its factories, machinery, vehicles, equipment and other properties pending the resolution of the dispute.
Naivas is also seeking to block KCC, its agents and financial institutions from withdrawing, transferring or dissipating funds held in the company’s bank accounts while the application and subsequent arbitration proceedings are pending.
The retailer wants the court to direct KCC to provide security for the KSh420 million claim within 14 days of service of the order.
The proposed security would take the form of an irrevocable bank guarantee issued by a reputable commercial bank in Kenya or a cash deposit into an interest-earning joint escrow account held by the advocates representing both parties.
Should KCC fail to comply, Naivas wants the court to order the attachment of the processor’s factories, real estate and fixed assets pending the determination and enforcement of the arbitral award.
The dispute stems from a distribution agreement dated January 1, 2022, which provides for arbitration under Clause 18(b).
According to Nyachoti, arbitration proceedings were instituted in line with directions issued by the court on December 1, 2025. Hearings are scheduled for November 5 and 18, 2026.
Naivas argues that recent government announcements concerning the restructuring and modernisation of KCC have heightened concerns about the preservation of the company’s assets before the arbitration is concluded.
The application cites directives announced by President William Ruto during the Agriculture and Food Systems Transformation Summit held at the Jamhuri Park ASK Showground in Nairobi between October 7 and 9, 2026.
Among the measures highlighted is a proposed government settlement of approximately KSh8 billion in outstanding debts and liabilities owed by KCC through the forthcoming Supplementary Budget.
The application also refers to proposed changes involving the modernisation of KCC’s milk processing plants, machinery and supply infrastructure, alongside the reorganisation of its financial operations and payment obligations to dairy farmers.
Naivas contends that these developments raise the risk that KCC’s assets or funds could be transferred, disposed of or otherwise dissipated before the arbitration proceedings are concluded.
The supermarket argues that such transactions could undermine its ability to recover the amount that may ultimately be awarded in its favour, potentially rendering the arbitration process ineffective.
It says the application was filed promptly following the October policy announcements and seeks to preserve the status quo until the dispute is resolved.
The application is supported by an affidavit sworn by Anthony Munene Kibetu, the supermarket’s managing director.
Naivas has also asked the court to certify the application as urgent and hear it ex parte in the first instance, with service initially dispensed with.
The court is yet to determine the application. The claims made in the filing remain subject to the ongoing legal process, and no preservation orders have been confirmed in the information provided.
