Uchumi Supermarkets has finally closed all operations in Uganda and Tanzania following half a decade of losses.
In a statement issued Wednesday, the Chief Executive Officer, Julius Kipng’etich, said the closure was part of the “drastic reorganisation” as their focus shifted to local market.
He said the two subsidiaries in Uganda and Tanzania have been posting losses in the last five years.
Last week, Uchumi Uganda closed Kabalagala branch after closing Nateete branch earlier on.
This week, the Kenya supermarket closed the Gulu branch bringing the total of stranded staff to 275.
In a notice we have seen, Golf Course management says Uchumi Garden City [main branch] has not paid rent arrears and has been evicted.
On Monday Court Bailiffs, working on the directive of a court raided the chain’s main outlet at Garden City in Kampala, seeking to recover a more than Shs180m debt owed to Ugachick.
Ugachick is one of the supermarkets poultry products suppliers.
In Gulu, Uchumi Supermarket was given a 1-week ultimatum by landlord, Donald Lukwiya, to clear Shs 110m in rent arrears accrued since July 2015.
Kipng’etich says their outlets in Uganda and Tanzania make up only 4% of our operations yet they account for over 25% of their operating costs.
Kipng’etich adds that they will now seek approval from shareholders to liquidate their operations in the two markets.
The closure, according to Kipng’etich said would quicken the process to stabilize its Kenyan operations.
Uchumi has had a series of problems with its suppliers having accumulated a combined debt of more than Shs33bn.
Uchumi has been employing more than 400 people in its six outlets in Uganda.
Kipng’etich took over the troubled retailer following the sacking of former chief executive officer Jonathan Ciano, over what the retailer’s board said was gross misconduct.
In Tanzania, over 300 angry staff barricaded the store in Dar es Salaam amid fears they would not get paid.
There have been reports that the chain, which is based in neighbouring Kenya, is closing some of its shops.
Uchumi has several stores in Tanzania but it is not clear how many will be affected.
The troubled chain has already sold some of its lucrative assets in Kenya to raise money as its struggles to get finance from banks.