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Keroche stares at liquidation after its lawyers move to court

The law firm hired to defend Keroche against KRA turned the tables and joined the list of organisations demanding millions from the brewery.

Tabitha Karanja CEO Keroche

A law firm that represented Keroche Breweries in its fight against the Kenya Revenue Authority has filed a petition at the high court, requesting orders to liquidate the company.

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Hamilton Harrison and Mathews law firm demanded Sh233.7 million in unpaid legal fees and interest accrued according to the petition.

Keroche had hired the firm to represent it in four cases involving tax demands made by KRA, to which the brewery objected.

In the circumstances, it is just and equitable that the company be liquidated,” reads the court documents.

The lawyers told the court that Keroche failed to pay the Sh233.7 million since March despite demand letters.

This insolvency court case adds more trouble for the brewery, which also owes KRA Sh22 billion in taxes.

Keroche also faces another Sh45.5 million outstanding payment to former managing director Sam Shollei, ordered by the Employment and Labour Relations court in August.

Sholei sued the brewery over what he termed as an unlawful sacking in November 2018, less than a year after starting the job

The court directed that Shollei be paid 10 months' salary as compensation for unfair firing, which sums up to Sh25 million and a gratuity of Sh5.5 million.

The judge also granted him a leave pay of Sh4.5 million.

Keroche dismissed Shollei before his four-year contract lapsed after the company cited low product sales.

Low product sales have also been the cause of Keroche’s financial woes.

The corporation's fight with KRA has resulted in the closure of the factory on many occasions.

In July 2022, High Court issued a directive to KRA to re-open the factory in Naivasha despite the ongoing tax dispute.

The court further provided Keroche with a new payment plan that required the company to pay Sh8 million each month from August 2022

However, KRA returned to court in September, protesting that Keroche had failed to honour the payments due for August and September.

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