Tyre distributor Sameer Africa will from February 1 start laying off 52 employees as it struggles to survive, deepening the job crisis in Kenya’s corporate scene.
The firm has continued to struggle even after its change of strategy in 2016 when it stopped local manufacturing of its key tyre brand Yana and opted to outsource to Asia.
Sameer now intends to close various tyre centres and offices across Kenya and release employees in batches between February 1 and end of April.
“Arising from the foregoing, the board of directors has resolved to restructure the company further by aligning the company operations to become more of a trading and distributorship outfit,” acting managing director Peter Gitonga said in a notice to Nairobi County labour office.
“It is therefore contemplated that approximately 52 employees drawn from both management and unionisable cadres will have their employment contracts terminated.”
Sameer group head count has been declining in the recent years, shrinking by 120 from 288 staff in 2017 to 168 at the end of 2018.
Chairman Erastus Mwongera confirmed the notice in a phone interview with the Business Daily, but said he could not immediately divulge the details on how much will be spent on the retrenchment.
“We have been restructuring since we changed the business model from manufacturing to retail. This comes with adjustments,” said Mr Mwongera.
Sameer widened its net loss 15.8 times to Sh182.8 million in the first six months of 2019, with stock-outs and counterfeit products complicating its recovery effort.