OK Zimbabwe grapples with funding quandary
SAMANTHA MADE
Zimbabwe Limited is grappling with a funding quandary as delays in the sale of its freehold properties have hindered the company’s ability to access US$10.5m in crucial liquidity, impacting its turnaround and operational plans.
The retailer has been executing a comprehensive turnaround strategy, which includes raising capital, restructuring operations, and engaging with business partners to restore profitability. However, the delay in property sales has left a critical gap in the funding mix.
Margaret Munyuru, the Group Secretary, confirmed that while OK Zimbabwe successfully raised US$20 m through a renounceable share rights offer, the company is still awaiting the completion of property sales to secure the remaining funding.
“The Group required a minimum of US$30.5 m to cure the liquidity shortage hampering business operations. The Directors approved the amount and presented the proposal to shareholders,” Munyuru said.
At an Extraordinary General Meeting (EGM) held on 17 July 2025, shareholders approved a capital raise of US$30.5 m, comprising US$20 m through a renounceable share rights offer and US$10.5 million from sales of freehold properties. While the rights offer was fully successful, the property sales have taken longer than anticipated, delaying access to the remaining funding.
“Sale and purchase agreements on two of the properties are about to be signed, while offers on the other three properties are in place to improve liquidity,” Munyuru added.
The delay has constrained OK Zimbabwe’s ability to inject the US$10.5 million into operations, funds that are vital for improving liquidity, supporting stock supplies, and boosting sales.
“Management is confident that some of the properties will be sold, and the proceeds will be paid into the business soon,” she said.
Despite the funding challenges, the group is pressing ahead with strategic developments. Munyuru highlighted ongoing projects, including the redevelopment of Chisipite Shopping Centre, relocating Bon Marché to a new facility, and constructing a larger OK Makoni store to enhance competitiveness.
“The Chisipite Shopping Centre is being redeveloped into a bigger mall, and the Bon Marché supermarket will be relocated to a newly constructed facility at the redeveloped Centre. OK Makoni is currently a very small store that cannot carry a meaningful product range. A new and more spacious store will be constructed for the Group to lease at Makoni Shopping Centre, which will give the store a better chance to compete for business in this busy location. Product supplies are being directed to stores in good locations that can improve stock turn and liquidity generation,” she said.
Operational rationalisation has also continued, with reductions in Head Office staff, a 35% cut in operating costs, and closure of loss-making pharmacy operations. A further 15% cost reduction is planned by December 2025.
“The Group has and will continue to rationalise operations down to a core retail focus. However, the level of revenue generation remains below break-even levels. The major constraints are limited product supply due to liquidity issues, as well as short trading terms,” Munyuru said.
Employee development and customer service remain central to OK Zimbabwe’s recovery efforts. Munyuru said staff training programmes are ongoing to enhance skills and competitiveness.
“The Group remains positive about the future and is fully supported by the Shareholders, with the Board of Directors and management working in concert for the recovery of the business,” she said.
