Pursuits
Bain’s Exit Leaves Edcon Struggling in South African Slump
- With lower debt, clothing chain seeks to recover market share
- H&M, Zara’s expansion in local market makes turnaround tougher
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Bain Capital Partners LLC’s decision to walk away from Edcon Holdings Ltd. leaves South Africa’s largest clothing retailer to claw back market share amid weak consumer confidence and a market recently populated by international heavyweights like Hennes & Mauritz AB.
The owner of the Edgars, Jet and CNA chains needs to make up ground ceded while struggling under a debt burden caused by Bain’s 25 billion rand ($1.8 billion) purchase in 2007. Competitors including H&M, Cape Town-based Woolworths Holdings Ltd. and Inditex SA-owned Zara have all increased market share in South Africa while Edcon has struggled to find funds for basic needs such as the maintenance of store elevators.