Ellerines� acquisition to save 230 jobs
Pauline Dikuelo | Tuesday February 9, 2016 12:18
Through the acquisition, Lewis will acquire 62 Ellerines Retail and Furnishers stores in Southern Africa for a purchase price of approximately R250 million (P175 million). This includes 25 stores in Botswana under the Ellerines and Beares brand, 21 in Namibia, 10 in Lesotho and six in Swaziland.
Ellerines, which is the furniture retail subsidiary of failed South African lender African Bank Investments Limited (Abil), went into bankruptcy last year after running losses of R70 million (P50 million) per month since 2013.
Administrators have since been trying to save the operations, which employed 8,000 people across 940 stores in Southern Africa.
According to a press release by the Competition Authority CEO Thula Kaira, Lewis will hire 230 employees of Ellerines Botswana who are currently faced with an imminent retrenchment. However this will not prevent Lewis Botswana, in the ordinary course, from retrenching employees as a result of changes to its operational requirements including store closures when such stores are not economically viable.
“Lewis Botswana shall harmonise the employment terms and conditions of employees employed in the Beares and Ellerines stores with the employment terms and conditions of Lewis Botswana.” However, they will throughout the review and harmonisation process engage in appropriate consultations with staff and the relevant trade union representatives. Lewis Botswana will also ensure that the harmonisation process is undertaken in accordance with relevant labour laws in Botswana.
The press release also stated that Lewis Botswana should invite 49 retrenched former employees whenever making new appointments on any created positions or that have become available for a period of 12 months from the date of approval of the transaction.
Lewis Botswana is also expected to provide the Authority with an immediate and long-term plan of how they shall harmonise the business models of the Beares and Ellerines stores within six months of the date of the implementation of the transaction.
“Lewis Botswana shall within the 12 months period, from the date of approval, provide the Authority with written reports detailing all vacant positions filled and the recruitment procedure followed as well as the rationale and sufficient proof of its transparency and fairness,” read the release. However, the approval does not override or negate any other mandatory statutory approvals or processes that any of the parties to these mergers must comply with under the laws of Botswana.