Foschini Stops South African Rental Payments on Virus Lockdown
Foschini Stops South African Rental Payments on Virus Lockdown
(Bloomberg) --
The Foschini Group Ltd., a South African clothes retailer, said it’s stopping rental payments because of the impact of the coronavirus outbreak.
All its South African stores, which account for the bulk of its 2,582 outlets across Africa, are closed after President Cyril Ramaphosa ordered a three-week national shutdown from March 27 to combat the pandemic. While essential services such as grocers, pharmacies, banks and gas stations are allowed to remain open, clothing retailers are not.
The Cape Town-based owner of Totalsports and American Swiss jewelery chains is also halting any planned expansion projects and will delay store refurbishments, TFG said in a letter to its landlords seen by Bloomberg and verified by the company.
“Once the situation normalizes we will then be able to assess the full financial impact on the business and will engage with you further,” it said.
This comes days after Edcon Holdings Ltd., South Africa’s second-biggest clothing retailer, said it may not be able to re-open after the 21-day lockdown.
Edcon, which had already been under financial strain, said what it’s experiencing is an indication of the challenge that many other businesses and the government will have to face after the shut down.
(Updates with additional comment from company from second paragraph.)
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