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The CEO who sometimes goes without salary

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Deep inside Nairobi’s busy Industrial Area, silence masks unending economic fear at the Uchumi Supermarkets head office.In its heydays, Uchumi touched the hearts of many consumers, but today the once giant retailer’s reputation is in tatters.

The listed supermarket last turned a profit over a decade ago and has survived several insolvency attempts. It is now saddled with a Sh7.6 billion debt that is more than its assets.

Uchumi is one of the worst performing stocks at the Nairobi Securities Exchange despite being the first retailer to list in the region in 1992.

Its shares closed last week at 30 cents from a high of Sh19.80 recorded in 2012.This puts the retailer’s current paper value at a modest Sh109 million, far from the Sh3.85 billion valuation between 2007 and 2015 when the shares traded at Sh14.50.

Though Uchumi has been written off countless times, Chief Executive Mohamed Mohamed is still convinced that the retailer will stage one of the greatest comebacks in corporate Kenya.           When Financial Standard visited the headquarters, a weary guard opened the iron gates to a compound that speaks loudly of its lost glory.

It is reminiscent of broken promises and ruined livelihoods.There are many vehicles at the parking lot, but inside the building it is deathly quiet. Finding the receptionist at their desk is a game of chance.Later, we learn that Kenya National Trading Corporation (KNTC), Uchumi’s landlord and a top shareholder, has since commercialised the parking yard after fights with the tenant over rent.

Hints of a fallen empire are in the empty offices full of old computers, equipment and stacks of dusty files. The many meeting rooms where ideas were once birthed now house loneliness.

Life might begin at 40, but for the 45-year-old Uchumi Supermarkets, the 40s are an unending race to escape the grim reaper’s deadly kiss.On the way to the CEO’s office, one gets a picture of how deprived the “Home of Value” has become.

Mr Mohamed has taken on what may be his toughest assignment yet – trying to revive a company that seems on its last kicks.Besides, the retail business has seen its fair share of the downturn. One of the employees sought reassurance from this writer on whether it is possible to turn around Uchumi as the staff are tired of delayed salaries.At one time Uchumi had over 1,500 employees and indirectly gave jobs to more than 250,000 people.

Today, it has only about 200 countrywide.Up the stairs to the first floor, across the hallway and into the corner office sits a soft-spoken man – coincidentally the same age as Uchumi.

Mohamed believes he can make history where many battle-hardened corporate gurus have failed and return Uchumi to profitability.He is not your ordinary chief executive. The trappings of power do not ooze from his tall frame.His office tells the tale of a big man making it with meagre resources. It is nearly empty with the shine of his large mahogany desk long gone.The grand bookcase is empty and the shelves are not lined with troves of documents, trophies or memorabilia.While other executives keep a few books and “pretend” to read, Mohamed says he has no time for books as he is too busy.

The chief executive, who inked a three-year contract in 2018, says he will only fully move into the office and even put up personal mementos when the business “stabilises.”Most executives of firms listed at the NSE are well compensated, earning millions in salaries and hefty bonuses.

But for the Uchumi boss, his title is just that, and he is not complaining.Mohamed wears resilience well. Beneath the power suits, it is hard to tell that he sometimes endures the embarrassment of not paying bills.He might be the only chief executive who lives in fear of electricity disconnection at home, or whether he will make his monthly rent. He is content with an iPhone 5 released to the market five years ago.

“People cannot understand how one can go out daily but not be able to put food on the table,” he says.“Sometimes rent arrears have accumulated, or I’m always under the constant threat of electricity being disconnected and sometimes even I’m late in paying school fees.”He is cautious, owing to the volatile nature of commerce, and is wary of making big promises.“I’m not here to promise heaven and earth, I’m only here to say that we have to execute on what we have been promising,” he told Financial Standard.

In the couple of years that Mohamed has been at Uchumi’s top seat, he has endured it all, including ridicule, delayed paychecks and sleepless nights.He admits that it is sometimes hard to get out of bed in the morning. “I’ve faced a lot of ridicule from many people. They don’t understand why I’m still working here,” Mohamed confides.

“There are people who call Uchumi a dead dog or say I’m trying to revive a corpse. I’ve received bad comments, but my focus is on the tough assignment before me.”Equating himself to a professional boxer, Mohamed says he cannot waste his energy brawling on the streets with every detractor.“You use your energy to add value to the business. I’ll just frustrate myself by getting annoyed and allowing that negativity to get inside my mind. I just laugh and move on,” he says.

One major reason why Uchumi has lost workers is delayed salaries. Mohamed says he sometimes cannot pay his own rent but calls that a “personal distraction” to a higher goal.He says the job has humbled him to the core and taught him profound lessons on patience. He is quick to point out that he has adapted and learnt to survive the many “shooters” from all sides.It has brought to him a sense of humility and changed his perspective about life – that one can survive on meagre resources.

Mohamed says at first, he was reluctant to take up the chief executive role knowing that he would be plunging into murky waters that have seen several of his predecessors quit.“It took me a while before I sent in my application after the advertisement. I kept questioning whether I was sure I could do this. Many of my colleagues were also trying to encourage me to take up this position,” Mohamed says.

Exactly a week ago, a key vote saved Uchumi from liquidation. This has boosted the CEO’s morale to turn around the retailer.The company owes creditors, including banks, suppliers and shareholders close to Sh5 billion.

It entered into an agreement – Company Voluntary Agreement (CVA) – with the creditors, with a promise to eventually settle the pending bills.The CVA, which restructures the retailer’s debt, will see the creditors take a 30 per cent cut and get repaid in parts over six years.The deal is the final gamble for Mohamed to kickstart Uchumi’s recovery.

It had been rejected twice before it was agreed upon last week. Aside from the haircut, 40 per cent of the debt owed to unsecured creditors will be converted to non-cumulative convertible preferred shares.

“The confidence was a big milestone for us because now we can move forward in the business immediately to get into some point of stability,” says the CEO.Mohamed, who has a telecommunications background, joined the retailer in October 2016 as a deputy to the former CEO.When he took office, he says, two strategic investors had promised to pump in substantial cash, which gave him hope of quick recovery.Besides, a government bailout was in the pipeline and they expected to sell a piece of land worth billions in Kasarani.Then, Uchumi had 20 branches. Sadly, a chain of disappointments followed. Mohamed said the government bailout of Sh570 million came late and in two tranches that had minimal impact on the recovery.“By the time it came in, there was already a significant reduction in the foothold and we lacked the trust of consumers,” he said.Strangely, months later, the new investors they expected went quiet.

This triggered mistrust as they were in talks with banks for some short term financing that was shelved after the deal failed to go through.At the moment, Uchumi is in talks with a strategic investor, but Mohamed is now wiser not to be too optimistic.

“I’m very cautious … I don’t want to reveal as we previously did until I’m sure of the seriousness of the investor,” he says.The Kasarani land, currently valued at about Sh2.8 billion, also proved difficult to sell after the Kenya Defence Forces laid a claim to it.The matter is currently at the Attorney General’s office, where the two have gone for an alternative dispute resolution.A deeply religious Muslim, Mohamed says faith has played a deep role in his daily routine as Uchumi CEO. It has given him great patience.

“Religion has given me that patience, the Prophet says that Allah is with those who are patient. I get back to faith to give me that peace of mind, I pray to God to give me consolation because I’m not the cause of this problem and whatever happened, I’ve done my best.”

Management style

The Uchumi captain does not go deep into what led to the retailer’s collapse, only saying the evolving leadership at the top took a toll on the business.He, however, warned if anyone was found to have played a part in running down the supermarket they should be charged.

“Anyone who had a sort of vested interest and caused these challenges we are in, if there’s proof, should face the law,” he says.He describes his current management style as very strict in enforcing the laid down rules and tightening internal controls.“

Even today, anyone I find involved in a funny transaction I fire on the spot. I’ve had to be very strict in making sure processes are followed because I want everything to be above board,” says Mohamed.

By Standard 


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Business

How top-level meeting allowed Radisson hotel to block Arboretum road

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Arboretum park lane has become the latest public road to have a barrier erected, much to the chagrin of many Nairobi residents.

Anyone who wishes to access the Nairobi Arboretum park, Kenya Forest Service, State House, State House Primary School, Kenya Girl Guides Association, Jabali Elementary School as well as the Radisson Blu hotel will have to pass through the Arboretum park lane.

The erection of the barrier left Nairobi Senator Johnson Sakaja seething with rage. And he registered his disapproval on social media.

“The Nairobi Arboretum is a public space that many Nairobians enjoy. The road leading up to it is also a public road. A private entity (Radisson) has put up a barrier on this public road where members of the public are screened. I have asked @NMS_Kenya to deal ASAP,” Sakaja wrote on Twitter.

He then warned Radisson hotel to remove the barrier.

Nation.Africa can, however, confirm that the barrier was erected after meetings of stakeholders and the Westlands sub-county security team.

Arboretum park lane has become the latest public road to have a barrier erected.

Amina Wako | Nation Media Group

The stakeholders, who included State House, Kenya Forest Service Arboretum, Jabali Elementary, Kenya Girl Guides Association, National Police Service and Radisson Blu requested to have the barrier erected for security reasons.

The conversation to have the barrier started after the January 2019 DusitD2 complex attack.

The boda-boda operators who camped outside the Arboretum entrance waiting for or dropping clients visiting the park also worried them.

As the conversation was going on, in July 2019, an intruder was shot and injured after he climbed over one of the State House gates.

The need to have a barrier became even more urgent.

So, they contacted the Kenya Urban Roads Authority (Kura) and they were allowed to erect the barrier.

“We are aware of the barrier. We allowed it there because of the security reasons raised by the stakeholders. Remember it is not a throughway, so it is important to know who goes in and comes out to avoid incidents like the State House intruder,” John Cheboi, the chief corporate communications officer at Kura, said.

Thereafter, the stakeholders, through Leisure Park Development Limited — the mother company of Radisson Blu Hotel — on December 10, 2019, wrote to Nairobi City County about the proposed erection of the security barrier.

And, on January 17 this year, the county replied granting permission for the work to begin.

“Authority to erect 1 No. security barrier to serve Plot L.R. No. 1870/X/106 on Arboretum Drive is hereby granted to you subject to compliance with the following conditions…” the letter, signed on February 17, 2020 by the Nairobi Chief Officer, Roads, Public Works and Transport, Eng. F.N. Karanja, read in part.

The council also acknowledged receiving Sh10,000 inspection fees for the work.

The work was, however, postponed because of the coronavirus pandemic, which was first reported in Kenya in March this year.

What followed next was government restrictions to curb the spread of the virus.

According to Edward Momanyi, the Food and Beverage Manager at Radisson Blu, the Sub-County Security Committee visited the hotel in September and spelt out conditions for erecting the barrier.

“The team, led by Westlands Deputy County Commissioner Mwai Gicheru, visited the area in September. They cited the conditions as a bulletproof guard booth, two armed police officers, and two security guards,” Mr Momanyi told Nation.Africa.

Because of the cost implications, the stakeholders met again on November 11, 2020, at the hotel.

“We invited everyone around this area including State House. We discussed the cost of setting up the barrier, bulletproof guard booth, two armed police officers and two security guards and how it would be shared among ourselves,” Mr Momanyi said.

But council warned that should any member of the public or residents along the Arboretum park lane object to the erection of the barrier, the barrier will be removed.

“That you be required to bind yourselves to the conditional clause of removing the barrier should the Nairobi City County receive reasonable objection to the barrier from one or more area residents or other members of the public,” the letter read in part.

“You shall indemnify the Nairobi City County against any litigation that may arise as a result of these works,” read one of the nine conditions set by Nairobi City County.

“This approval is valid if the works commence and are completed within three months,” it further said.

Arboretum becomes the latest public road to have obstacles.

In September this year, Muthaiga Residents Association mounted a roadblock restricting access to the suburb by boda-boda operators, commercial vehicles and pedestrians.

An email from the association’s secretariat, dated September 22, said the move was due to security reasons.

“No motorbikes and commercial vehicles are allowed to enter Main Muthaiga Road from Oil Libya Plaza, Kiambu Road and from Mini Muthaiga Round-about including house-helps, construction site employees,” read the email signed by Christine Chiriba, for the secretariat.

Further, residents were asked to provide details of their employees, including job card or a letter indicating the name of the staffer, ID number, plot or house number, employer and their contact number.

In 2014, the county assembly moved a motion to remove barriers erected on public roads by the Runda Residents Association.

by Nationafrica


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Lifestyle

TRAGIC: Woman kills self after realising hubby’s plan to get second wife

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A 38-year-old woman has committed suicide in Migori after learning that her husband had a secret lover he was planning to marry.

According to police reports, the body of Pamela Atieno was found dangling from the roof of her house on Friday morning at their rural home in Kameji sub-location, Rongo sub-county.

Chief John Agoro who reported the incident to Rongo Police Station said that Atieno took her life after she learnt that her husband was planning to marry a second wife.

“The deceased reportedly differed with her husband after she learned that he had another lover and was planning to marry her as a second wife,” said Agoro.

Atieno is reported to have left a suicide note to her husband before taking her life.

“I have decided to die because of your secret plan to (marry) another wife,” the suicide note read in part.

Never differed

Michael Ondito, the woman’s husband, however, denied arguing with Atieno, adding that he had gone to the farm only to come and find his wife had killed herself.

“I was called when I was at the farm in the morning but upon reaching home I found the body of my wife hanging on a rope on our doorstep, I was surprised because we had not quarrelled or fought,” said Onditi.

Chief Agoro, however, condemned the action saying people should find other ways of solving family differences.

“Domestic problems should not lead to people killing themselves. We are supposed to look for guidance and counselling experts,” the administrator said.

Rongo police boss Peter Okiring while confirming the incident said police received the information and went there to collect the body which was transferred to Rosewood Hospital’s morgue.

“We have launched our investigation into the matter but we are yet to confirm the reason why the deceased committed suicide,” said Okiring.

BY Standardmedia.co.ke


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Entertainment

Terence’s wife Milly Chebby savagely attacks troll who called her a hippo

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Terence Creative’s wife Milly Chebby is tired of body-shamers. She’s not giving them a room to pin her down with their negativity.

Well, the mother of one has savagely clapped back at a fan who compared her to a hippopotamus. The fan, identified as Winfred, body-shamed Milly, offering to help her reduce her tummy.

‘Kuja nikuuzie dawa ya kumaliza tumbo 🤔’

Chebby savagely responded and she wrote

‘Uzia mamako.’

Chebby vs troll

Winfred went ahead to troll the YouTuber, comparing her to a hippo.

‘hippopotamus binguni utapata mwili mpya,’ Winfred posted.

The plus-size media personality responded and she wrote,

@wi.nfred3517 Kuja na real account tukuone Beyonce huyu hippo ako tu sawa hivi 🖕.

Milly Chebby

by Mpasho.co.ke


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