Edcon Groups announces sale of CNA to Astoria Investments
JOHANNESBURG - The Edcon Group has announced the sale of CNA to a majority owned by JSE-listed Astoria Investments in a move seen as exiting non-core assets.
Edcon said the transaction is aligned to its broader strategy which is to focus on its core business through the realignment of its retail brands and operations.
The group has been battling to restore its balance sheet, weighed down by a heavy debt and has adopted a turnaround strategy.
However, the sale of CNA is still subject to regulatory conditions and the sale includes 167 CNA stores.
Edcon chief executive Grant Pattison said CNA is an important but not a strategic part of the Edcon business, as it is not focused on clothing, beauty and home categories, and they would only sell if it is good for CNA.
“Edcon has a simple business model that is focused on delivering an enhanced customer experience, and an optimised store portfolio, ultimately creating a focus on our three divisions, Edgars, Jet, and Thank U,” Pattison said.
Pattison added that the new owners have the muscle and extensive management focus and leadership expertise to invest in the business.
“I am also pleased that this transaction will not result in any job losses”, he said.
Last year, the Public Investment Corporation (PIC), which is the largest investor in SA, pumped around R1.2 billion in a recapitalisation of Edcon to save jobs and to support it in its turnaround strategy.
As a result Edcon managed to save around 140 000 jobs.