KENYA – Botswana headquarters retailer, Choppies Supermarkets, has closed one of its outlet in Kenya, despite the retailers ambitious expansion plan in the rapid growing retail sector.
The Bungoma unit in Western Kenya was closed after the retailer’s continued struggle to stay afloat amid the ongoing corporate troubles that have rocked the company since last year.
The Botswana retailer started as a single store in 1986 and has grown to South Africa, Zimbabwe, Zambia, Mozambique, Namibia, Tanzania and Kenya where it grew to over 12 stores after acquiring homegrown retailer, Ukwala Supermarkets.
Choopies also had unveiled plans of opening two new outlets in the country this year, according to a report by The Standard, but the plans have stifled after plunging into a US$1.268 million (Sh126.8m) loss from six insolvent outlets in Kisumu and Nakuru.
Last year, the retailer failed to publish its annual financial results and its holding company, Choppies Enterprises Ltd, was subsequently suspended from the Botswana and Johannesburg Stock Exchanges.
The retailer has been undergoing an extensive legal and forensic investigation into the supermarket chain’s operations in the recent past.
The group announced in December last year that financial director Sanooj Pullarote resigned on December 15 but would continue to provide assistance to Choppies until the financial results were published.
The company’s board has also suspended its Chief Executive Officer, Ramachandran Ottapathu, pending the outcome of forensic and legal probes into the group, which boasted revenues of about US$847.05 million (P9 billion) in 2017 from operations in eight countries.
However, Mr Ottapathu defended his position in the retailer remarking that “Choppies requires urgent governance and operational remedial interventions, including a review of board performance and composition.”
Recently the retailer moved to solve its shareholding dispute in Zimbabwe that saw former Zimbabwe vice-president, Phelekezela Mphoko divest out of the local subsidiary Nanavac Investments which trades as Choppies Supermarkets in Zimbabwe.
Mr Mphoko was paid US$3 million to exit the company.
Choppies still counts as one of the giant retailers on the continent represented in a weighty over 210 stores in eight African countries where it now employs about 17,000 people.