Edcon’s banks and bondholders take control of the struggling retailer
BANKS and bondholders have taken control of struggling clothing retailer Edcon, its CEO said on Tuesday.Taken private in a highly leveraged R25bn buyout by Bain in 2007, Edcon has struggled to grow at a fast enough rate to pay down debt."We have been living beyond our means, expenditure was more than our income," CEO Bernie Brookes told a news conference.New owners of the company, which also sells household goods and footwear, are Standard Bank, Barclays Africa Group, FirstRand, Standard Chartered and Investec. Others are Franklin Templeton and Harvard Pension Fund.The retailer 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 in SA.Brookes said Edcon reached "a catastrophic situation in March" and had to choose between business rescue or not paying debt holders.Reuters
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