The Competition Tribunal has approved The Foschini Group to acquire Jet stores subject to conditions, while seller Edcon has said that it would maintain its big branch of Edgars in downtown Johannesburg, which has been there for 90 years and is being renovated, a major impetus to the central business district.
It was reported earlier this month that the Jet deal was one step closer after the Competition Commission recommended to the tribunal that the merger be approved with conditions relating to employment and local procurement.
A report in Moneyweb today quoted Edcon spokesmen saying that the downtown Johannesburg shop on Pritchard Street would be kept going. Edcon, which is present under business rescue, had closed or downsized numerous stores before the COVID-19 pandemic struck. The Johannesburg store will reportedly be much smaller and the renovated building will also have a Shoprite.
According to the Tribunal, the conditions to the Jet merger include Foschini not retrenching any employees for two years and Edcon employees given preference should vacancies arise in the Jet business for three years from the merger implementation date.
Jet stores should also maintain almost the same ratio of procurement of products from South African manufacturers and suppliers as they did at the end of its preceding financial year. Also, they should endeavour to increase local products and suppliers.
The TFG put an offer to buy Jet from Edcon for a cash purchase consideration of R480 million. TFG announced last month that it had concluded a purchase agreement, reports said.
The cash-strapped Edcon Holdings filed for bankruptcy protection in April after losing R2 billion during the hard lockdown to curb the spread of COVID-19.
Jet sells clothing, footwear, homeware, cosmetics, cellular and insurance products locally, and has stores in Botswana, Namibia, Lesotho and the kingdom of Eswatini.
The merger means that at least 381 Jet stores will be retained and about 4 664 jobs saved.
The Commission, which assesses large mergers before referring them to the Tribunal for a decision, found that the transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets.
– Additional reporting by SAnews.gov.za