Shoprite may be next in line to size up CNA

Posted On Wednesday, 31 July 2002 02:00 Published by
Rate this item
(0 votes)
Supermarket retailing group Shoprite Holdings could be the next suitor to undertake a due diligence investigation on troubled newsagents and stationery chain CNA
Supermarket retailing group Shoprite Holdings could be the next suitor to undertake a due diligence investigation on troubled newsagents and stationery chain CNA before deciding whether to put in a bid for part of the company.

Last week, Corpcapital, which had originally expressed interest in taking on the whole of the CNA group, said it was not satisfied with the outcome of its due diligence investigation and would not proceed with the heads of agreement.

CNA, with 220 stores and 3600 employees, was plunged into financial crisis after its owners, Gordon Kay & Associates, defaulted on the last R70m instalment of the purchase price due to Wooltru. Last week, CNA was placed under provisional judicial management and over the weekend one of the companies in the group, Consolidated News Agencies, was placed in provisional liquidation.

Shoprite marketing GM Brian Weyers said yesterday Shoprite's interest in CNA was just a rumour at this stage as the group could make a decision only after conducting its investigation.

He said 'everyone was looking at CNA' but doubted there would be bidders for the whole group. 'There are a lot of stores there and some are in good locations and some in bad locations. The solution has a large property component attached to it.'

Apart from the issue of store locations and leases, another hurdle to the Corpcapital deal was, according to financial website Moneyweb, questions over a transaction. MTN paid CNA R85m for exclusivity in CNA stores and this money was used to discharge part of the purchase price due to Wooltru from owners Gordon Kay & Associates. According to Moneyweb, Corpcapital questioned whether this transaction contravened the Companies Act. Corpcapital said yesterday that it could not clarify this issue.

Business Day


Publisher: Business Day
Source: Business Day

Most Popular

Balwin Properties announces R9 billion Munyaka Crystal Lagoon development in Waterfall, Midrand

Feb 06, 2020
Munyaka Crystal Lagoon
JSE listed Balwin Properties, a developer that cares about environmentally responsible…

2020 Commercial Property Themes –Electricity supply and cost will be a key wildcard for the Commercial Property Sector this year

Jan 23, 2020
John LoosFNB
Will electricity supply reliability and cost increases become a key issue again in 2020?

Nedbank’s facilitation of the Barloworld-Khula Sizwe transaction highlights the bank’s commitment to transformation in the commercial property sector

Jan 24, 2020
Nedbank Barloworld Khula Sizwe
Nedbank’s facilitation of the Barloworld-Khula Sizwe transaction highlights the bank’s…

All the insurance you need as a homeowner

Jan 23, 2020
Carl Coetzee CEO of BetterBond
As a new home-owner, you are going to need three types of insurance – at least one of…

The Harri launches in Cape Town's thriving East City Precinct

Jan 23, 2020
The Harri Cape Town
The Harri offers 39 stunning studio and two-storey penthouse apartments, blended with…

Please publish modules in offcanvas position.