OK Zimbabwe Limited has unveiled plans to sell some properties to raise part of the required US$30 million to stabilise its operations.
Last month, OK revealed that discussions were underway for a US$30 million capital raise to clear its debt with suppliers.
In a circular to shareholders yesterday, OK said it would raise US$20 million from existing shareholders and the planned sale of properties to raise the balance of the required capital raise.
“The company has identified certain immovable assets, from which selected properties will be disposed of to raise US$10 500 000 in net proceeds, after accounting for disposal-related costs,” OK said.
“For properties currently occupied by the company, the sale will be contingent upon the buyers agreeing to lease the properties back to the company under pre-agreed long-term lease arrangements.”
The proposal means OK will continue operating in some of the locations, without owning the underlying real estate.
The properties up for sale are OK Mbuya Nehanda, OK Glen View, Birmingham Warehouse, OK Gweru, OK Malvern, Stand 6464, Ordar Township, Stand 39, Odar Township, Harare, Stand 19676, Harare Township of Borrowdale, Harare, and a Mutoko stand.
The OK Mbuya Nehanda, OK Glen View and Birmingham Warehouse properties will be mortgaged off to FBC Bank Limited, while OK Gweru, OK Malvern, Stand 6464, Ordar Township and Stand 39, Odar Township, Harare have been pledged to the National Building Society.
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The remaining Stand 19676 Harare Township of Borrowdale, Harare, has been pledged to CBZ Bank Limited.
“Given prevailing market conditions, the properties offering the greatest saleability and value realisation will be prioritised for disposal,” OK said.
The renounceable rights offer being proposed will be done by way of issuing new ordinary shares.
“The board is seeking shareholder approval to raise new capital amounting to US$20 000 000 through a renounceable rights offer of 1 834 982 573 new ordinary shares in the share capital of OKZL,” OK said.
“A shareholder of OKZL will be entitled to subscribe for 1,37 new ordinary shares for every 1 share held on July 21, 2025 (record date).
“It is specifically recorded that the currency of this rights offer is US$ in forma specifically only, and each shareholder elects to pay any sum due by it hereunder in US$, and any payment due to any party under this rights offer transaction shall be in US$.”
According to OK, it owed over US$30 million to creditors, with most of these amounts overdue.
“The balances are split as follows: suppliers owed US$24 million; other payables, including utilities, services, marketing, cleaning and security amounting to US$5,12 million; and statutory obligations amounting to US$880 000,” OK said.
The retailer said the proposed rights offer and asset realisation initiatives were not standalone actions, but integral pillars of a bold, co-ordinated transformation agenda.
“The company is entering a transformative period underpinned by a clearly defined turnaround strategy aimed at restoring financial strength, operational efficiency and long-term shareholder value,” OK said.
“This strategy reflects a bold recalibration of the business and its leadership.”
