Online Reporter
Business Reporter
Retail giant OK Zimbabwe has been placed under corporate rescue with effect from Tuesday after suppliers stopped extending credit and trading with the company.
The board of directors passed a resolution on February 23 to voluntarily commence corporate rescue proceedings in terms of Section 122 of the Insolvency Act [Chapter 6:07].
Mr Bulisa Mbano of Grant Thornton Chartered Accountants (Zimbabwe) has been appointed as the corporate rescue practitioner.
In a sworn affidavit, board chairperson Mr Charles Msipa said despite raising US$20 million through a rights offer approved by shareholders in July 2025, the company’s financial distress has deepened as suppliers have drastically reduced credit extension.
“Suppliers have reduced credit extension and payment terms have been shortened to one week or a maximum of two weeks. Suppliers have stopped conducting business with the company as they do not want to increase their exposure,” Mr Msipa said in the affidavit.
The board resolution, dated February 23 and signed by all directors, noted that the lack of stock in stores had triggered a significant decline in revenue and cash flows.
“As a result of not having the products in the stores, the company has experienced a significant decline in revenue and cash flows, and its operations have virtually ground to a halt,” the resolution stated.
The company used part of the rights offer proceeds to pay down creditor debt, fund working capital, capital expenditure and transaction costs.
However, the measures proved insufficient to restore supplier confidence.
The board expressed confidence that the company remains viable, citing valuable assets including buildings, equipment, human capital, customer following and industry knowledge that could be leveraged to achieve a turnaround.
The notice was filed with both the Master of the High Court and the Registrar of Companies on Tuesday.
All affected persons — including creditors, employees, trade unions and shareholders — have been formally notified in accordance with statutory requirements.
The corporate rescue practitioner will now investigate the company’s affairs, consult with stakeholders and prepare a restructuring plan aimed at either returning the company to solvency or securing a better return for creditors.
OK Zimbabwe was registered in 1953 under registration number 118/1953.
