Seventy companies have been struck off the Registrar of Companies list in the past two months while a further 44 are line up for dissolution over the next three months, according to a public notice.
Winding up of companies in Kenya is a formal insolvency procedure in which a company is brought to an end.
This can be done where a firm is liquidated and the proceeds from the sale of assets are used to repay creditors.
In some instances if the company has completed the purpose of which it was formed or it’s no longer operational it can also be dissolved.
However, the registrar has not indicated the reasons for the dissolution of the named companies.
The mentioned companies cut across various sectors including, hospitality, consultancy, real estate, ICT, construction and communication.
Following the announcement the registrar is now calling for the submissions on the 44 firms facing dissolution in the next three months.
“Pursuant to section 897 (3) of the Companies Act, the Registrar of Companies gives notice that the names of the companies specified hereunder shall be struck off from the Register of Companies at the expiration of three months from the date of publication of this Notice, and invites any person to show cause why the,” reads the notice.
A classification by sector shows that some of the dissolved companies are in different fields including consultancy, trading, real estate, hospitality, fashion and motor vehicle, among others.
The shut downs come at a time that unemployment is on the rise in the country further pilling pressure on the state.
The latest number adds to another 280 companies that applied for dissolution in January this year.
Businesses have grappled with rising operational expenses and reduced demand for their products and services, impacting their profits leading to insolvencies and layoffs.
For instance last month, the Central Bank of Kenya in a survey found that the private sector plans to retrench at least 15 percent of their workforce this year as the high cost of living, high taxes a weak shilling and reduction in customers weigh down businesses.
The businesses, excluding banks, indicated in the survey they "definitely" don't expect to retain 15 percent of the workforce they had in 2023 in the current financial year.
This could translate to more than 300,000 workers that companies plan to lay off. Kenya's employment statistics in 2022 showed that the private sector employed 2,077,500 workers.
Out of the workforce, the financial and insurance activities sector employed 70,000 Kenyans.
Cigarette maker Mastermind late last year announced plans to terminate around 1,000 employees following its administration by I&M Bank, while Sendy reduced its workforce by 20 per cent due to financial constraints.
Listed firm Bamburi early in the week joined six other listed firms at the Nairobi Securities Exchange (NSE), which expect their profit margins to drop by a quarter compared to 2022.
They include Express Kenya Limited in December, Longhorn Publishers, Sameer Africa, Centum Investment Company, Crown Paints, WPP Scangroup, Longhorn Publishers, Sasini, Car & General, Nation Media Group and Unga Group.