HARARE – OK Zimbabwe Limited has entered voluntary corporate rescue following a failed US$30 million recapitalisation effort and a worsening liquidity crisis, marking a significant development for one of the country’s largest formal retail chains.
In a notice issued to stakeholders on February 25, legal representatives Wintertons confirmed that Bulisa Phillimon Mbano of Grant Thornton Zimbabwe was appointed to oversee the rescue process with effect from February 24.
Under Zimbabwe’s insolvency framework, the commencement of corporate rescue proceedings automatically stays all legal actions and enforcement measures against the company, providing temporary protection from creditors while a recovery strategy is formulated.
The move follows months of mounting financial strain. A US$20 million rights issue conducted in August last year failed to sufficiently stabilise the retailer’s balance sheet, leaving outstanding obligations estimated at approximately US$30 million. Subsequent plans to raise additional equity and unlock value through asset disposals struggled to gain traction in an economy characterised by persistent liquidity shortages and subdued investor appetite for property assets.
Industry sources indicate that suppliers are owed roughly US$24 million, a situation that has significantly disrupted operations. Several major creditors reportedly tightened payment terms or withdrew credit facilities altogether, contributing to stock shortages across parts of the retailer’s nationwide network.
OK Zimbabwe, which once operated 71 stores, has already shuttered 11 outlets, reducing its footprint to 62 locations. The closures underscore the operational pressures facing formal retailers amid declining consumer spending power, rising input costs, and structural shifts within Zimbabwe’s retail landscape.
The company’s latest financial disclosures revealed an 84% decline in revenues for the period ending September 2025, highlighting the severity of the downturn. Analysts attribute the deterioration to a combination of factors, including elevated energy costs, exchange rate volatility, supply chain disruptions, and intensifying competition from informal sector operators.
Zimbabwe’s expanding informal economy — often referred to as the “tuckshop sector” — is increasingly reshaping the retail environment. Estimates suggest that informal trade now accounts for more than three-quarters of total economic activity, placing sustained pressure on formal businesses that face higher compliance and operating costs.
The appointed corporate rescue practitioner is required to publish a formal rescue plan within 45 business days. Market observers expect the strategy to centre on debt restructuring negotiations, potential capital injections, rationalisation of the store network, and aggressive cost containment measures.
OK Zimbabwe’s shareholder register is dominated by institutional investors, including Datvest Nominees Foreign, the National Social Security Authority, Old Mutual Life Assurance Company, and Stanbic nominees.
The corporate rescue proceedings are likely to be closely watched by investors and policymakers alike, given OK Zimbabwe’s long-standing role in the country’s formal retail sector and the broader implications for business confidence in a challenging operating environment.
