OK says to complete capital raise by June 

Source: OK says to complete capital raise by June – herald

Nelson Gahadza, Zimpapers Business Hub

OK ZIMBABWE says discussions to raise US$30 million in capital are at an advanced stage, as the retailer seeks to revitalise the business, which has faced several challenges, including limited ability to restock and significant debt.

The country’s biggest retailer is targeting to complete the fundraising by June.

Last month, OK Zimbabwe’s board resolved to undertake the recapitalisation to bridge a funding gap, pay creditors, clear debts and stabilise the company. Chief executive officer Mr Willard Zireva, in an interview, said good progress had been made so far, with the majority of the major shareholders committing to follow their rights.

“Currently, we are finalising discussions with potential underwriters, and we are targeting to have the whole process completed and cash received before the end of June 2025,” he said.

Amid the teething challenges, which had resulted in most key suppliers refusing to do business with the retailer, OK Zimbabwe decided to shut down six branches as of March 31, 2025 and lay off the affected staff. It has since reversed the decision to close OK Mbare and Entumbane, as part of the operations reboot exercise.

According to the retailer, the capital raise will be attained through a combination of a rights issue, private placement and debt instruments. The primary objective of the initiative is to strengthen the group’s balance sheet and liquidity position to enable the company to enhance working capital availability and ensure smooth business operations.

To turn around the situation, OK Zimbabwe rehired former long-serving CEO Mr Zireva, who had stepped down eight years ago. Following Mr Zireva’s return, the retailer has indicated a rethink of its plans and will reverse the planned closure of some of its branches, which was being pursued by the previous management.

The retail group is reportedly saddled with US$17 million and ZWG537 million in outstanding accounts to suppliers, some of whom allegedly pounced on part payments meant to unlock fresh supplies and refused to give new orders.

The capital raise initiative is expected to provide OK Zimbabwe with the necessary funding to bridge the financial gap stabilise operations, and support its ongoing strategic turnaround plan.

In a recent cautionary statement, OK Zimbabwe said further details will be announced in due course, and the company will then publish a circular to shareholders incorporating notice of an Extraordinary General Meeting for the capital raise.

“Accordingly, shareholders and the investing public are advised to continue exercising caution when dealing in the company’s shares. Further announcements will be made under regulatory requirements as and when there are material developments,” reads the statement.