EAST LONDON, Jan 31 (ATB) – South African retailer Edcon needs 3 billion rand ($226 million) in financing over the next three years to allow it time to “fix” the business, its management said on Thursday.
Edcon’s chief executive Grant Pattison told Reuters that the capital injection “gives us a runway of two to three years so management can focus on fixing the business and not raising cash”.
Correspondents say that Edcon has been grappling with an over-leveraged capital structure for several years, after troubles in
its credit business in 2014 coincided with an economic slowdown and weak consumer spending at home.
The Giant retailer has been in talks with lenders and other investors about injecting money into the business while asking landlords to reduce rents.
Edcon is the largest non-food retailer in South Africa employing more than 14,000 full-time staff in over 1,100 stores with 138 stores outside South Africa.