Kenya’s only home-grown automaker, Mobius Motors Kenya, is shutting down operations, ending its 13-year journey amidst mounting debts and a multi-million shilling tax dispute.
The company said in a release on Tuesday morning that shareholders at a meeting held on August 5 resolved to liquidate the company.
“At a meeting of the Shareholders held on 5-Aug-2024, it was resolved to place the company under liquidation as per section 393(1) (b) of the Insolvency Act and to appoint KVSK Sastry as the liquidator to wind-up the Company,” Mobius director Nicolas Guibert said in a release.
The company did not give a reason for the voluntary liquidation. However, its exit comes on the back of debts and tax disputes with the Kenya Revenue Authority (KRA).
Mr Guibert said the list of creditors and proxy forms will be made available for inspection at Mobius’ head office in Nairobi’s Sameer Business Park on Friday, August 9.
Mobius was founded in 2011 by British businessman Joel Jackson to build cars for the African market. The first generation, Mobius II, was launched in Kenya in 2015.
In 2018, the KRA slapped Mobius with a tax demand of Sh85.74 million based on assessments for the period January 2014 to December 2016 in relation to capital received from the parent company.
Mobius appealed the claim to the Tax Appeals Tribunal but lost the case. The company had demonstrated its financial vulnerability by submitting its accounts and warned that paying such a sum would lead to its collapse.
The company’s financial statements showed that at the end of August 2020, it had a debt of Sh649.2 million and a shareholders’ deficit of Sh389.1 million.
