Uchumi Pays KES 240Mn to 170 Suppliers in Revival Strategy

The Uchumi Supermarket chain has paid KES 240 million to its suppliers who signed up for the escrow account in May.

“I am glad today (Thursday) that those who supplied in May and June have received payment,” said Mr. Kimani Rugendo, chairman ASK.

“Suppliers under this arrangement are paid every 30 days. The payment today covers May and June. We will continue supplying as Uchumi has proved that the escrow model is working,” Mr. Rugendo added.

Read: Uchumi Out of the Woods as Suppliers Agree to Bailout Plan

Dr. Julius Kipngetich, CEO Uchumi Supermarkets said with the payment, they have kept their promise and their Stakeholders’ interest safeguarded.

May Escrow cheques were at Ksh 46.9 million. June Escrow cheques were Ksh 196 million.

Rugendo further noted that their customer retention rate is at 80 per cent currently. He also clarified those cases before the court do not affect the positive milestones Uchumi is having. The case will be heard 29 July 2016.

The establishments of an ESCROW account to manage the current debt. According to the deal with the suppliers, the conversion of 50%of part of supplier debt into equity and 50 % balance will be considered as old debt. With an aim to restructure debt owed to suppliers and govern resumption of supplies to the retailer.

In an interview with NTV Kenya, a Kenyan local television, Kipng’etich said by August Uchumi would have achieved its turnaround.