Edcon liquidation

[Dawier]

I was wondering, if Edcon group gets liquidated, will clients still need to pay their accounts?
I do not have any account or debt with them, but just wanted to know.
Because if the debt will be written off, they have a big problem.

 

[Drifter]

I guess not, you will still need to pay.

 

[Ancalagon]

The debtor's book will probably be sold to someone who will then try to collect on it.

 

[Dawier]

That always confused me.
As far as I know liquidation means are assets are sold, and company debt written off.
Just could not understand who gets the money from the clients.
Also, all the paying clients with a 12 month plan or something similar, who do they pay?

 

[Nobody Important]

That always confused me.
As far as I know liquidation means are assets are sold, and company debt written off.
Just could not understand who gets the money from the clients.
Also, all the paying clients with a 12 month plan or something similar, who do they pay?

Don't confuse company debt with the debtors book.

Customers are debtors and the debtors book would be sold for cents to the Rand to a Third Party company. This would allow Edcon to get some immediate cash to offset any money owed to creditors.

Edcon's debt is to their creditors. Part of the liquidation process would have them sell the debtors book (customer accounts) for as much as they can in order to settle what they owe to their creditors.

Customers will have to settle their accounts with whomever this Third Party company is.

 

[Polymathic]

I thought ABSA owns their accounts

 

[Drifter]

Queue calls from New Debt Management and MBD.

 

[ToxicBunny]

That always confused me.
As far as I know liquidation means are assets are sold, and company debt written off.
Just could not understand who gets the money from the clients.
Also, all the paying clients with a 12 month plan or something similar, who do they pay?

A debtors book is sort of an asset... Company debt is collected to whatever level they can sell the assets for...

 

[Dawier]

Don't confuse company debt with the debtors book.

Customers are debtors and the debtors book would be sold for cents to the Rand to a Third Party company. This would allow Edcon to get some immediate cash to offset any money owed to creditors.

Edcon's debt is to their creditors. Part of the liquidation process would have them sell the debtors book (customer accounts) for as much as they can in order to settle what they owe to their creditors.

Customers will have to settle their accounts with whomever this Third Party company is.

Will this affect people's credit rating in any way though?

 

[Nobody Important]

Will this affect people's credit rating in any way though?

It shouldn't if the process is handled correctly. The only hiccup I can imagine would be if the communication to customers (that they must now pay Company X going forward) is not effective and people just stop paying because they either don't know what has happened, or are opportunistic and hope nobody will notice or take them on.

But as another member said previously, ABSA is involved in Edcon's books, so I would imagine the handover and communication with customers to be relatively painless.

 

[Rouxenator]

I wonder if they will change their name to "Ed kon nie"