EDITORIAL: A tough time to revive Edcon
Lenders, be they retailers or banks, should be very cautious about granting credit
SA’s largest nonfood retailer may at last be coming to the end of its long and bumpy turnaround phase. But it can’t expect that much help from the market at a time when consumers are under pressure. Retail group Edcon’s annual results last week were significant more for the extensive debt and shareholder restructuring that happened during the year, and for the appointment of a new CE, than for the operational details of the year itself. The huge R27bn debt burden that the group had been carrying was cut to R6.2bn in the 2016 deal in which some of its creditors took control of the troubled group, swapping debt for equity. That should free up cash and management time that can be focused on fixing the business. And a new person will take charge of fixing it up: the group has announced that Grant Pattison, the well-regarded Massmart CE who led the group through its sale to Walmart, would take over as Edcon’s CE from February 2018. There clearly is much to be done to restore the group to...
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