Struggling retailer Uchumi Supermarkets yesterday announced the formation of a new committee to help its restructuring process.
The team to consist of external legal, accounting and retail consultants is expected to help the retailer clear its debts and return to sustainable operations.The team is expected to present a proposal to creditors by end of first quarter of 2019.
“We are putting in place a plan to create sustainable operations while ensuring we expeditiously meet all our obligations,” Uchumi CEO Mohamed Mohamed said in a statement.
Besides, the retailer is banking on the team to identify and recommend a ‘return to normalcy restructuring plan’ that will see the supermarkets restock and rebrand.
“The financial restructuring team cannot be disclosed until the process is over to avoid jeopardizing the sensitive process,” the retailer, Uchumi said.
He said progress towards accessing fresh capital and fully restocking some branches is so far positive.
Last week, the CEO confirmed to the Star on their move to seek supplier support to look at different avenues for turning around Uchumi.
The team has been formed amidst an ongoing suit aimed at winding up Uchumi Supermarket filed by Kiambu-based milk processor Githunguri Dairy Farmers Co-operative Society.
This petition is likely to seal any hopes of recovery .
Last month, court documents revealed that the cash strapped retailer had entered into an agreement with Jewel Complex Limited to sell its Kasarani land at Sh2.8 billion.
The retailer is banking on the sale to pay its suppliers and creditors whom it owes up to Sh3.6 billion.
Franchising, opening of smaller branches and going digital are some of the strategies that the Board and Management of Uchumi Supermarkets Ltd have identified for the chains return to normalcy.