Conglomerate Press Corporation Limited (PCL) has sold one of its subsidiaries, Peoples Trading Centre (PTC) Limited, having had a streak of losses and accumulated K18 billion in debt with suppliers in recent years.
South African-based firm, Tafika Holdings Limited (THL), has bought the franchise at K6 billion, which is expected to go towards servicing the debt arrears.
Inside sources say, in one of the management-employees engagements, management indicated that the K18 billion debt dates back to 2013.
“The K18 billion is owed to suppliers because PTC buys on credit and there were times PCL could come in with a bail-out; it usually went towards servicing the debt,” the source alleged.
PCL acting Chief Executive Officer, who also sits as PTC Board Chairperson Lyton Chithambo said the debts were being managed.
“The debts are being managed. PCL is managing and PTC is managing others and, so, it is a well-articulated sale so everything is taken care of. The K12 billion is already being managed by PCL,” Chithambo said.
A memo bearing the subject ‘Important Announcement to PTC Employees’ dated March 11 2022 and co-signed by THL Executive Chairperson and Chief Executive Officer (CEO) Arson Malola and PTC Chief Executive Officer Ferdinand Mchacha indicates that THL has entered into and signed a sale and purchase of shares agreement with PCL to acquire 100 percent shares in PTC.
It further indicates plans to rejuvenate the business by, among other things, adopting e-commerce solutions and providing customer centric services in its outlets.
“This has been a long and stressful process for everyone given that the transaction has taken months to conclude,” the Memo reads.
Mchacha said in a separate interview that focus is on a recapitalisation programme which will run for five years.
“The part of recapitalisation is restocking and current stores upgrade; then we will have skills and trainings upgrade programmes to improve customer service and the last part of the recapitalisation is expansion programme. We are targeting around 200 stores by the end of the five years from the current 20.
“On the debts, it is indeed true that we had significant debts that pushed as to find an investor and as part of the recapitalization package, our shareholders are paying off all the debts that we had,” Mchacha said.
A Chain Circular No2 of 2022 form the PTC CEO dated February 21 2022 indicates that the shareholder (PCL) had successfully completed the search for an equity investor which commenced in 2021.
A statement co-signed by Chithambo and Malola says THL intends to modernise the stores to radically improve customer experience and offer a full range of products at all times at competitive prices.