Banking & Finance
Keroche Faces Liquidation Over Severance Row
Kenya’s independent brewer Keroche struggles under a KSh22 billion ($165 million) tax claim and legal challenges. Former MD’s unpaid severance pushes the firm closer to collapse. Industry watchers await the court’s July ruling.
Ex-MD Sam Shollei seeks to liquidate Keroche Breweries over KSh75M unpaid severance, deepening the brewer’s legal and tax troubles.
Keroche Breweries, Kenya’s largest independent alcohol producer, is facing a new threat of liquidation. Former Managing Director Sam Shollei, who won a KSh75 million ($560,000) severance claim in 2022, has filed a court petition seeking to wind up the company for failing to pay.
The suit, lodged at the High Court’s Commercial Division, is the latest in a string of legal and financial setbacks for the Naivasha-based brewer.
Shollei, who briefly served as CEO of the Standard Group, joined Keroche in early 2018. However, his stint was cut short by what the Employment and Labour Relations Court later ruled as “unfair and unjust dismissal.”
“I was brought in to professionalize the company, but internal differences led to my abrupt dismissal,” Shollei told Citizen TV in 2023. “The court ruled in my favor, but they have refused to comply.”
In 2022, the Employment and Labour Relations Court awarded Shollei the following:
- KSh12 million: six months’ salary in lieu of notice
- KSh20 million: compensation for unfair dismissal
- KSh15 million: gratuity for the contract term
- KSh5.5 million: unpaid leave and benefits
Keroche paid only KSh7 million, leaving an unpaid balance of KSh45.5 million. Shollei now wants the court to wind up the company under the Insolvency Act, citing persistent non-payment.
This is the third major liquidation case Keroche faces in under three years. The most serious stems from a KSh22 billion ($165 million) tax dispute with the Kenya Revenue Authority (KRA), which includes excise tax arrears, penalties, and interest dating back to 2015.
The tax standoff led to plant closures in 2022 and 2023, causing significant production losses. A 2024 repayment plan later collapsed after Keroche failed to meet payment terms.
Hamilton Harrison & Mathews Advocates, one of Kenya’s top law firms, has also sued the company for KSh233.7 million in unpaid legal fees. The firm had represented Keroche in the ongoing KRA dispute.
Keroche was founded in 1997, starting with fortified wines before launching beer products like Summit Lager, positioning itself as a challenger to EABL.
By 2019, the brewer claimed 20% market share in Kenya’s bottled beer segment and had expanded into five East African countries. That growth was backed by a KSh1 billion plant upgrade.
However, COVID-19 disruptions, regulatory clampdowns, and tax hikes reversed much of that momentum. In 2022, CEO and co-founder Tabitha Karanja exited the business to join politics, adding to instability.
The court is scheduled to hear Shollei’s petition in July 2025. If successful, the company could be placed under administration or fully liquidated. This would threaten hundreds of jobs in Nakuru County and further shake Kenya’s alcoholic beverage industry.
Keroche has yet to respond publicly to the new lawsuit. However, it has previously blamed its woes on aggressive tax enforcement, delayed court settlements, and pandemic-related disruptions.