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Johannesburg - Administrators implementing a rescue plan for African Bank Investments'(Abil) furniture business Ellerine have so far failed to find bidders for the bulk of the assets, they told creditors in an update on Friday.
Failure to dispose off assets could potentially reduce the amount creditors can expect to receive after the business that owes nearly R1.3bn ($118m) is wound down fully.
Ellerine was forced into a so-called business rescue process - similar to Chapter 11 bankruptcy in the United States - in August after parent company African Bank, or Abil, cut off funding. Days later Abil was rescued by the central bank.
"The practitioners have followed a strategy to achieve the best possible return for creditors. However, to date, the practitioners have only received offers to purchase the Beares and Dial-a-Bed divisions of the Company," Matuson Associates said in the update, referring to previously announced offers.
They also have an indicative R400m offer for the company's interests outside South Africa - about 80 stores in five other southern African nations.
But that still leaves the bulk of Ellerine's business, which includes six chains selling furniture and home appliances across South Africa. Abil bought Ellerine in 2008 in an ultimately disastrous attempt to sell furniture on credit.
The administrators estimate creditors could receive as much as 30 cents for every rand owed under their restructuring plan, instead of the 13 cents ceiling a liquidation would have gleaned for them.
