Ellerine Furnishers (Pty) Ltd
Ellerine Furnishers (Pty) Ltd, a retailer of furniture and household appliances , commenced with Business Rescue in 2014. This has been the largest Business Rescue to date, based on the Public Interest score of the Company. The firm employed almost 8000 people and had operations in six African countries, comprising over 1000 stores.
In 2010 the provision of credit and financial services component was sold to African Bank. This resulted in a significant decrease in the Company’s income and profitability. A decision was taken that no further funding would be provided by ABIL or African Bank in August 2014 and it was thereafter resolved to place the company into Business Rescue.
Ellerine Furnishers held a deposit of R472million with African Bank that would have been utilised as Post Commencement Funding (PCF). However, the Bank was placed under Curatorship less than a week after the commencement of the Business Rescue. With no accessible funds in the bank accounts, there was an urgent need to secure PCF
PCF was eventually secured after extensive discussions with African Bank. Store closures, realisation of stock and sales of part of the business have all been carried out, saving approximately 2000 jobs to date.
The dividend paid to creditors to date has far exceeded the ‘best case’ dividend that creditors would have received in liquidation and it is estimated that the final dividend will be approximately 42c in the Rand.
Download our expert insights below.