South Africa’s Edcon has secured 2.7 billion rand ($191 million) in new cash and rent deductions as part of a plan to recapitalise the struggling department store chain.
The owner of Edgars and stationary retailer CNA has been grappling with its debts for several years, after troubles in its credit business in 2014 coincided with an economic slowdown and weak consumer spending.
In January, Edcon’s chief executive Grant Pattison said it needed 3 billion rand ($226 million) in financing over the next three years to allow it time to “fix” its business.
Edcon, which vies for market share with TFG, Truworths and international chains such as Zara and H&M, is one the biggest names in South African retail, employing more than 14,000 full-time staff in over 1,100 stores.
It has been in talks with lenders and other investors about injecting money, while asking landlords to reduce rents in exchange for
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