Retail giant OK Zimbabwe has started receiving offers for some of its properties, which it is selling to raise US$10.5 million for settling debts.
The properties include supermarkets, which OK would then lease.
“The leaseback arrangement is necessary to ensure the Group continues to operate in its strategic store locations,” said the company in an update.
“When the group was in decline, retail skills were lost as trained and experienced personnel left employment for better opportunities. It will therefore be essential to retrain the existing staff to raise levels of customer service and standards of performance,” OK added.
In addition to the property sales, the retail giant has secured US$20 million from shareholders to repay debt and restock.
OK Zimbabwe is currently contending with “acute financial distress,” marked by limited operational cash flows, escalating debts, and an increased risk of legal action from unsettled creditors.
The financial strain has also severely undermined the company’s operational capacity.
In response, the board of directors is proposing the disposal of several immovable assets to generate urgent working capital. Properties earmarked for sale include OK Mbuya Nehanda in central Harare, OK Gweru, OK Glen View, and OK Malvern. The company also intends to sell a warehouse and two vacant commercial stands as part of the recovery package.
The restructuring plan comes at a time when the retail giant, once a household name across Zimbabwe, has been losing ground to more agile competitors amid macroeconomic instability and inflationary pressures.
The company hopes that the asset sales will offer a lifeline, helping it avoid further deterioration and possible judicial proceedings.
Zwnews
