[2008-10-14]  Investors in Uchumi to wait longer for dividend

Shareholders whose money is locked up in Uchumi Supermarkets will have to wait much longer for a dividend despite the retail chain’s return to profitability.

The chain’s executives hope to pay dividends to shareholders in 2012 after compensating for its past losses, according to the firm’s five year business plan.

But this was hinged on the entry of an investor in August to pace up the chain’s turnaround plan by injecting about Sh800 million and offering management experience to help beat the growing competition in the retail market.

Last week, Uchumi broke from a six-year loss-making stretch to post net earnings of Sh95 million, but the firm requires investment to complete its turnaround strategy.

Mr Jonathan Ciano, the chain’s receiver manager, told a media briefing that the search for an investor was at an advanced stage.

“Consultants are still working on the transaction and they are barely half way through,” Dr Silas Njiru, the chairman of the advisory committee (the equivalent of Uchumi’s board of directors) told Business Daily.

Dr Njiru, who is also the permanent secretary in the Ministry of Trade, said the consultants had a brief of eight months, a clear signal that the selection of the equity investor would spill over to the coming year.

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