New HoldCo's Acquisition of Edcon approved with conditions
JOHANNESBURG – The Competition Tribunal has approved the acquisition of the Edcon Group, South Africa's biggest clothing retailer, by New HoldCo with conditions.
Edcon, which has been battling to save jobs after poor strategic decisions and mounting competition from new entrants, will merge with New HoldCo registered as K2019216440.
“The merger is intended to achieve restructuring and recapitalisation of the debt and equity structure of Edcon. This, to provide a stable platform for the planned turnaround of Edcon,” the tribunal said.
It found no public interest or competition concerns for the merger and said Edcon was in financial distress and at risk of being forced into business rescue or insolvency proceedings.
The conditions of the merger include “Edcon’s commitment fostering and developing a more competitive production environment in South Africa. This involves increasing local procurement, black economic empowerment and ensuring that there are no job losses as a result of the merger,” said the tribunal.