Absa inks R10bn Edcon deal

2012-06-07 09:08

Banking group Absa has taken over retailer Edcon’s store card book for R10 billion.

This is its largest investment since Barclays bought a controlling stake in the group five years ago.

Absa will gain access to nearly 3.9 million Edcon customers through this deal.

It also has the option to buy Edcon’s credit books in Botswana, Namibia and Swaziland, according to the daily.

It will be responsible for the credit, fraud management, risk, finance, legal and compliance operations of the store card business.

Edcon would retain sales and marketing, customer services and collections. The deal would be funded from internal resources.

Banking analyst Faizal Moolla from Avior Research told the paper the investment would grow Absa’s market share.

“It will increase Absa’s share in the unsecured lending space and they will probably be the biggest in terms of market share among the big four banks,” the daily quoted Moolla as saying.

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