Pesa Nane wrote:mlennyma wrote:They are raising about 680m so I think it may suceed for fear of dilution if one avoids it but on the other side mr.market may decide to offer a better rights later
more like
890M or thereabouts.
Mr. Ciano has lost it. Time to take a break. They were just singing about the rights issue when the price was ripe-Ksh. 19 - 21. And now a rights issue at todays price? Well, somebody just courted failure
Why should he care? Owns no stake in the business (a vvsish statement!!)and takes home 1.1 metres a month... Who else misses Suresh Shah???
c&p from
http://kumekucha.blogspo...supermarkets-story.html
The Untold Uchumi Supermarkets StoryAs Uchumi Supermarkets Came Crushing Down Recently, I Couldn't Help Remembering The Smiling Son Of A Dukawalla, The Genius Who Built Up The Supermarket Chain. There Are Many Lessons To Be Learnt Here
I was recently asked by this naïve young girl who has recently completed high school how a business like Uchumi can actually collapse. To her, Uchumi going down was akin to the Central Banking collapsing, it just doesn’t happen.
I then realized that many Kenyans are thinking just the way my young friend was.
My mind went back to my friend Suresh Shah son of a dukawala and born in Mariakani (near Mombasa) who is a chemical engineer by training but was Uchumi’s most successful managing director.
Suresh got his degree from a world famous technical university but couldn’t find a job in Nairobi in the mid 70s, so when an opening with ICDC as a management trainee came up, he grabbed it and never looked back. He cut his teeth doing a painful restructuring at ART (African Retail Traders) that saw him shut down a number of outlets. Then fate landed the then troubled Uchumi Supermarkets in his hands. His instructions were actually to shut it down in an orderly manner.
The supermarket had been launched in Kenya with the help of Italians and was therefore packed with Italian products that nobody wanted. To discover this, Suresh sat in the supermarkets daily for about 30 days (from opening to shut down time) to study the trade. (A fascinating lesson for MDs who want to fully understand their business).
The only thing Shah ended up shutting down in his amazing turnaround achievement at Uchumi were a full Butcher unit in the Industrial area which was bleeding badly. That helped focus the business on the retail trade. He also fired a few employees who were rampant thieves.
Maybe one day Shah’s remarkable feat will be recognized more widely because when he took over Uchumi as MD it was technically bankrupt already. He kept it going by working out a simple and yet elaborate system of turning over cash as many times as possible before having to finally pay a supplier. It involved persuading suppliers to take payments after 45 days and then he used the cash generated from their supplies to make as much additional profits as possible before payment became due.
At the height of Uchumi’s glory, the supermarket chain was a heavy investor in short term treasury bills.
Then there’s the story of the Ngong Road branch of Uchumi. Initially it is said that Suresh almost had a seizure when he was given a quote of what a structure was going to cost on the then vacant lot that the chain had just acquired after Shah noted the heavy affluent traffic on Ngong Road and saw it as an opportunity Uchumi could use. So what did he decide to do? He opted to build a warehouse supported by steel structures on the four corners. Unfortunately the guy hired to excavate the ground did not believe the instructions to dig so close and went ahead and dug according to their own specifications. Shah found a way to use the extra depth and the underground car park was born.
Everybody complained about the ugly ceiling of a warehouse not being appropriate for Uchumi’s stature. They were wrong, shoppers don’t spend their time staring at the roof in a supermarket and anyway the extra high roof without a ceiling saved a fortune in possible air-conditioning facilities. In the end the building cost only a small fraction of what it would have actually cost had conventional thinking been used. That was the genius of Shah. No doubt this stuff was in his bones having been the son of a dukawalla (Asian small trader)
It is now clear that those who took over from Shah despised what they perceived to be his penny-pinching ways. The result is the catastrophe we now have in our hands where over 1,000 families are in serious trouble as their bread winners lose a regular source of income.
Maybe you should find a way to come back Suresh, and help sort out this mess.