News / National
Edgars Zimbabwe to purchase Edcon's Africa business franchises?
25 Sep 2018 at 08:01hrs | Views
Edcon Holdings' latest recovery plan includes closing chains including Red Square cosmetics and La Senza lingerie and attempting to lure their customers to its flagship Edgars clothing stores.
"The strategy also includes disposing its Africa business franchises to Edgars Zimbabwe," said one who is aware of the developments at Edgars.
"If all goes well, Edgars Zimbabwe will purchase all the African business franchises and will be paying a franchise fee to Edcon Holdings. As we speak, Imara Corporate Finance is doing the due diligence of the whole transaction."
The move is the brainchild of new CEO Grant Pattison, who replaced Bernie Brookes at the helm of South Africa's biggest non-food retailer in February.
The Johannesburg-based company has long struggled to stay afloat amid weak consumer spending and economic growth, and had to be taken over by banks and bondholders in 2016 to avoid collapse.
Under Pattison's strategy, Edcon will reduce its 1,300-store footprint and cut floor space by 17% over five years to boost profitability.
The retailer will focus its attention primarily on Edgars, which already sells most of the ranges available in the stores that will close. Edcon will also retain discount clothing specialist Jet and its CNA chain of stationery stores, though Boardmans homeware is set for the chop.
Edgars Zimbabwe released a cautionary statement advising all shareholders that the Company is still engaged in discussions that may result in a transaction which may have a material impact on the value of the Company's shares.
A telephone call to confirm the Edgars Zimbabwe developments did not yield any results because of the sensitivity of the issue.
CAUTIONARY STATEMENT
"The Directors of Edgars Stores Limited wish to advise all shareholders that the Company is still engaged in discussions that may result in a transaction which may have a material impact on the value of the Company's shares. The Directors, therefore, advise shareholders to exercise caution when trading their Edgars Stores Limited shares and should consult their professional advisors before dealing in their shares."
"The strategy also includes disposing its Africa business franchises to Edgars Zimbabwe," said one who is aware of the developments at Edgars.
"If all goes well, Edgars Zimbabwe will purchase all the African business franchises and will be paying a franchise fee to Edcon Holdings. As we speak, Imara Corporate Finance is doing the due diligence of the whole transaction."
The move is the brainchild of new CEO Grant Pattison, who replaced Bernie Brookes at the helm of South Africa's biggest non-food retailer in February.
The Johannesburg-based company has long struggled to stay afloat amid weak consumer spending and economic growth, and had to be taken over by banks and bondholders in 2016 to avoid collapse.
The retailer will focus its attention primarily on Edgars, which already sells most of the ranges available in the stores that will close. Edcon will also retain discount clothing specialist Jet and its CNA chain of stationery stores, though Boardmans homeware is set for the chop.
Edgars Zimbabwe released a cautionary statement advising all shareholders that the Company is still engaged in discussions that may result in a transaction which may have a material impact on the value of the Company's shares.
A telephone call to confirm the Edgars Zimbabwe developments did not yield any results because of the sensitivity of the issue.
CAUTIONARY STATEMENT
"The Directors of Edgars Stores Limited wish to advise all shareholders that the Company is still engaged in discussions that may result in a transaction which may have a material impact on the value of the Company's shares. The Directors, therefore, advise shareholders to exercise caution when trading their Edgars Stores Limited shares and should consult their professional advisors before dealing in their shares."
Source - Byo24News
