OK Zimbabwe closes Lobengula St branch

Struggling retail giant OK Zimbabwe has closed its Lobengula branch in Bulawayo as the company continues to grapple with deepening financial challenges.

The closure is part of a wider downsizing exercise that has seen the 83-year-old retailer shut down several outlets across the country after plunging into what it describes as "choppy waters".

Among the affected operations are the Food Lovers Borrowdale and Avondale branches in Harare, whose franchise agreements were not renewed. Additional closures include OK outlets in Robson Manyika, Glen Norah, Kuwadzana Express, Mbare and Mabelreign, as well as branches in Chitungwiza Town Centre and Entumbane.

The retailer was placed under corporate rescue in February following mounting financial pressures, including debt obligations and persistent stock shortages.

Despite raising US$20 million through a rights offer approved by shareholders in July 2025, the company's position worsened after suppliers significantly reduced credit lines, limiting its ability to restock shelves.

A board resolution dated February 23, signed by all directors, highlighted the severity of the situation.

"As a result of not having 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 had used proceeds from the capital raise to settle creditor obligations and fund working capital, capital expenditure and transaction costs. However, these measures were insufficient to restore supplier confidence.

Despite the closures and operational setbacks, the board maintains that the business remains viable, pointing to its asset base, experienced workforce, established brand and loyal customer base as key pillars for a potential recovery.

All stakeholders, including creditors, employees, trade unions and shareholders, have been formally notified in line with statutory requirements.

A corporate rescue practitioner has since been appointed and is currently assessing the company's financial position, engaging stakeholders and developing a restructuring plan aimed at restoring solvency or achieving a better outcome for creditors.