Edgars owners mum on shop closures
07 February 2019 | Business
Edcon currently finds itself in a cash crunch and has had to rely on banks and entities to which it had sold debt to stay afloat owing to slowed growth in South Africa.
The group previously announced that it would close several of its franchises, including Boardmans.
When approached on the possibility of more closures, Edcon would not comment.
“Edcon will not be making any further announcements on specific store closures or openings,” the group said in an emailed response.
The Sunday Times reported in mid-January that Edgars, Jet and CNA outlets faced the risk of closure, with the loss of an estimated 140 000 jobs, as a result of their failure to pay high rental fees.
Edcon reportedly planned to downsize some of its shops in what was seen as an ambitious revamp. This was said to form part of the retailer's ongoing restructuring to take it back to profitability and convince investors that a leaner business is viable.
The non-food retailer had also set a plan in motion to reduce its footprint in shopping centres in its native South Africa.
“Edcon's restructuring and recapitalisation process is continuing. The Edcon board has approved the structure of the proposed recapitalisation plan, and in response lenders have extended waivers to allow time for implementation. This will allow sufficient time for the number of necessary due diligence and governance processes to be completed,” the group said.
The Public Investment Corporation, which manages the pension funds of government employees in South Africa, may provide a much-needed injection of N$1.8 billion to keep Edcon afloat.
The group operates 187 outlets in Namibia, Botswana, Lesotho, Swaziland, Mozambique, Ghana, Zimbabwe and Zambia.
Overall, the group owns approximately 1 200 stores. It employs around 30 000 permanent and casual workers.