More than 300 jobs have been saved at failed South African furniture retailer Ellerine Holdings after the Competition Commission recommended an offer by Shoprite Holdings for 217 stores be approved.
The transaction, which includes the retailer’s Wetherlys outlets, should ensure that there will be “no retrenchment of the remaining 308 employees post-merger,” the Competition Commission said in an emailed statement on Thursday.
Ellerine went out of business in August after parent company African Bank failed. Administrators winding down the operations – which once had more than 940 stores and employed 7 060 people – have been unable to sell three of Ellerine’s six main brands.
Lewis Group is buying the 63-store Beares brand for R90-million, while Coricraft Group has said it will purchase Dial a Bed, valued at R200-million.
The Competition Commission said last month that no staff would lose their jobs as a result of the Lewis acquisition.
Brothers Sidney and Eric Ellerine started the furniture company in Johannesburg in 1969, and it grew to be one of the country’s biggest retailers.
African Bank, which bought Ellerine in 2008 to boost its lending operations, loaned too much money to people who couldn’t afford to pay it back, and the lender collapsed in August as losses mounted.
Ellerine’s business rescue plan is due to be published early next year, according to African Bank’ administrators. – Bloomberg