Retail group TFG — which owns Foschini, American Swiss and @Home — has agreed to pay R480m to acquire about 371 commercially viable Jet stores from struggling Edcon.
Edcon is in business rescue and its business rescue practitioners have accepted the terms of TFG’s conditional offer, the group said in a statement.
Under the deal, TFG will acquire a minimum of 371 stores, the Jet brand, and all existing stock holdings with a minimum stock value of no less than R800m.
The deal will also cause the “transfer of selected key executives and staff of Jet to ensure sufficient management capacity”, the statement reads.
“As part of the conditional offer, TFG will assume the operational commitments associated with the commercially viable stores only, such as employee and lease commitments, albeit on a renegotiated basis.”
Edcon filed for business rescue in April after it was unable to pay suppliers after weak sales from January, which were worsened by the Covid-19 lockdown.
In a trading update on Monday TFG said it remains under pressure from Covid-19, but does not believe the Jet deal will significantly alter the group’s capital requirements.
Group consolidated retail turnover declined 43% for the three months ended June 27 compared with the same period in the previous financial year, with significant trading disruptions caused by government-enforced lockdowns and regulations on social distancing in all three of its major operating territories — SA, the UK and Australia.