Hamleys SA chain saved

PLANS: NEW OWNERS AIM TO RECAPITALISE

Suren Naidoo Moneyweb

Christmas has come early for Hamleys South Africa – the local franchise operations of the world’s oldest toy store chain – as it has been saved through the business rescue process after facing closure earlier this year.

A new black-empowered company, Antares, is set to take it over, effectively recapitalising the business and saving 140 jobs. Antares is backed by two independent Joburg-based family-owned retail groups, Osbro Home and Rand Outfitters.

Senior business rescue practitioner Stefan Steyn, confirmed that a successful business rescue plan had been put together and had received “majority support” from Hamleys SA’s creditors.

“The business rescue team met all the creditors and worked with Hamleys management team to save the business. We believed it was a business worth saving. The business rescue process was crucial for its survival. Had we not secured the deal, it would have been liquidated,” he said.

“We had over 30 leads with potential buyers and investors to recapitalise the toy chain, but most were looking for a bargain. Osbro has a track record in retail and realised the value in the Hamleys brand, with their plans aimed at stabilising and growing the business,” he added.

The announcement of the deal follows Moneyweb breaking news in February that the local Hamleys franchise was facing financial trouble and placed into business rescue. At the time, the chain closed one of its biggest stores in SA at Mall of Africa in Waterfall City, which is majority-owned by Attacq Limited. Hamleys’ first store in the country at Greenstone Mall in Edenvale has also since closed its doors.

Ensolor, the local franchise operator of Hamleys, hit financial trouble in January following allegations of fraud within the company. When the group was placed into business rescue in February, Steyn would not comment on the fraud allegations.

Fraud charges laid

He, however, confirmed on Monday that charges of fraud have now been laid against the Ensolor group’s founder and sole director, Philip Paphitis.

“We have not managed to track him down, but a case of fraud was opened at the Bedfordview Police Station.”

Reiterating a statement Moneyweb received from Hamleys South Africa’s new owners, Steyn noted that the group was in turmoil when it was forced into business rescue in February.

“The business was left abandoned, in debt, along with empty bank accounts by the [then] sole director and shareholder,” he said. “Despite securing new owners to recapitalise the company, we are still pursuing the former owner and more than R20 million in lost funds.”

Faheem Mohamed, a director at Osbro Home, told Moneyweb the group sees good potential in growing the Hamleys chain in SA. However, he says over the next 20 months the focus will be on stabilising the business and its existing stores.