HARARE – Two major retailers, Westend Foodworld Investments (Private) Limited and Trade Centre (Private) Limited, both part of the same group, have been placed under corporate rescue due to financial distress.
The companies’ Boards of Directors announced the moves, citing economic pressures and increasing competition from informal retailers.
According to corporate rescue notices issued on March 5, 2025, both companies filed resolutions with the Master of the High Court on February 17, 2025, to be placed under corporate rescue under the Insolvency Act [Chapter 6:07]. The process aims to restructure their businesses, assets, and liabilities to restore financial stability.
The restructuring will be led by corporate rescue practitioner Alexious Dera of Moore PNA Zimbabwe, who has been appointed to oversee both companies’ recovery plans and guide them toward solvency.
Foodworld Investments said it has struggled to meet its obligations to creditors over the past 24 months, mainly due to exchange rate volatility and competition from unlicensed retailers selling goods at undercut prices.
“In placing the Company in corporate rescue, the Board has carefully considered that, over the past twenty-four (24) months, the Company has faced considerable challenges in meeting some of its obligations to creditors as and when they fall due,” the board stated in a corporate rescue notice seen by Kukurigo.
“This has primarily been necessitated by exchange rate volatility and competition from unlicensed retailers who are under-cutting prices. The mismatch in currency inflows and compared to the currency of payment and the devaluation of the local currency meant that the Company could no longer service its United States dollar debts as and when they fell due.”
Trade Centre cited similar challenges, noting that since Q3 of 2024, it had implemented cost-cutting measures, shifted obligations primarily to ZiG, and divested non-core assets to support recapitalization.
Trade Centre also noted similar challenges adding that “Since Q3 of 2024, the business implemented a cost containment and restructuring exercise which resulted in the reduction of USD obligations, the movement of settling of obligations primarily in ZiG and the disinvestment in non-core assets to provide further equity to fund the Company’s recapitalization efforts.”
“The Company has valuable assets and strong market share in the retail sector and as a result there are opportunities for the Company to tap into and resolve its cash flow challenges. Interventions by the Government of Zimbabwe in the past few months in curbing the illicit flow of irregularly imported goods by unregistered retail shops and individuals will assist the formal retail sector to retain its competitive advantage,” the Trade Centre Board stated.
“On account of the above and in order to provide the Company with an opportunity to recover and be restored to a sound financial footing, the board resolved to place the company in corporate rescue with effect from the 17th of February 2025. It is the board’s belief that the corporate rescue process with the assistance of the Corporate Rescue Practitioner will facilitate a restructuring of the Company, its balance sheet, and cashflow in a manner that will return the Company to financial viability. It should be noted that all of the Company’s branches remain open, for trade with our suppliers and retail customers going forward,” the Trade Centre board concluded.
