Some of the dissolved companies include well-known names like Chandarana Investment Limited, Afsol Energy Limited, Inovate Medical Devices Limited, Phoenix Supply Chain Limited, Sunlight Industry Company (K) Limited, and Wallmart Wholesalers Limited. Others on the list include Ideal Freight Kenya Limited, Kisae Education Institute Limited, Wealth Creation Limited, and Taji Institute Company Limited
Thousands of Kenyans are facing potential job losses after 116 companies were officially dissolved by the Register of Companies, and another 115 businesses have announced intentions to shut down within the next three months. These companies, which span various sectors such as manufacturing, retail, Information and Communication Technology (ICT), and other service industries, reflect the deepening economic challenges currently facing Kenya.
According to a Kenya Gazette Notice dated January 3, 2024, several companies were struck off the Register of Companies in December 2023. Joyce Koech, the Registrar of Companies, issued the notice, citing the provisions of the Companies Act, Section 897 (4), which allows for the dissolution of companies that no longer meet the legal requirements.
Companies Struck off the Register
Some of the dissolved companies include well-known names like Chandarana Investment Limited, Afsol Energy Limited, Inovate Medical Devices Limited, Phoenix Supply Chain Limited, Sunlight Industry Company (K) Limited, and Wallmart Wholesalers Limited. Others on the list include Ideal Freight Kenya Limited, Kisae Education Institute Limited, Wealth Creation Limited, and Taji Institute Company Limited.
The Companies Act allows the Registrar to remove a company from the Register upon request by its directors, and such applications are effective only if filed by the company’s directors or the majority of them.
115 Companies to Close Within Three Months
The economic strain is far from over, as an additional 115 companies have issued a warning that they will be shutting down in the next three months. These companies span a range of industries and include Jinan Contractors Limited, Technocrat Ventures Limited, Anselm Design Limited, First Global Health Limited, and Peponi Holdings Limited. Other companies on the closure list include Sinbad Limited, Ramazon Limited, Sky Horse Company Limited, Synergy Overseas Limited, Sunny Irrigation Limited, and Dualis Limited.
According to Section 897 (3) of the Companies Act, these companies will be removed from the Register three months after publication of the gazette notice unless any party can present a reason why they should not be struck off.
A Bleak Job Market
The mass company closures and dissolutions come at a time when unemployment in Kenya is already at alarming levels. The Federation of Kenya Employers (FKE) reported a loss of 70,000 formal private-sector jobs between October 2022 and November 2023. High interest rates, unpredictable market conditions, and frequent government policy changes were cited as key factors contributing to the widespread job cuts.
Several businesses have laid off workers in recent months, citing the tough business climate. For instance, global security firm G4S (Kenya) announced in November 2023 that it would lay off at least 400 employees due to reduced business revenue and high operational costs caused by the ongoing economic downturn.
The Need for Support Funds
In response to these mounting job losses, the FKE has proposed the establishment of a fund to support businesses and workers during difficult economic times. This proposed fund, which would help keep struggling companies afloat and prevent further job cuts, has yet to be established by the Kenya Kwanza administration. The Federation believes that such a fund would protect workers who have lost their jobs involuntarily and help cash-strapped firms survive.
Despite these economic challenges, the government continues to insist that Kenya’s economy is on the path to recovery, citing a decrease in inflation to a 14-year low of 2.7% in October 2024. However, many Kenyans are yet to feel the positive effects of this recovery, as layoffs and company closures continue to increase.
In light of these developments, it’s clear that the road to economic stability remains uncertain for many Kenyan workers and businesses.
