Stable to growing employment, increased focus on import-replacement as well as securing the Edcon Empowerment Trust were all made conditions of approval by the Competition Tribunal.
The Competition Commission had recommended that the plan to convert Edcon’s creditor base into equity holders be approved unconditionally.
However, following intervention by Economic Development Minister Ebrahim Patel, the tribunal’s approval came with conditions attached.
These conditions mirrored the plans Edcon announced in September. The troubled retailer will retain the current workforce and "is likely to" employ an additional 2,000 new staff within two years.
According to the tribunal’s order, the additional employment will depend on "extraneous circumstances such as prevailing macro and micro economic conditions and trading conditions, (as well as) internal circumstances such as the state of Edcon’s financial position and operating performance".
Edcon also reiterated its commitment to implementing an import-replacement programme. In terms of the tribunal’s condition it has agreed to meet with representatives of the Economic Development Department on a quarterly basis for five years and other public entities that might be invited.
The retailer has also agreed that the Edcon Empowerment Trust will not be affected versely by the restructuring.
Brookes welcomed the support he received from the competition authorities.
"Given that the company has much to do to get competitive, it was responsible of them not to enforce onerous covenants."
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