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Cape Town - The Ellerines furniture group has started a process to retrench staff, reported Netwerk24.
It currently has more than 7 000 workers and more than 1 200 shops in South Africa.
The business rescue practitioners Leslie Matuson and Jayant Daji Pema, who was appointed by Ellerine, announced earlier this week that certain shops will be closed and certain parts of the business restructured.
READ: Ellerine applies for 'rescue'
This includes the warehouse and distribution operations and its head office.
The restructuring programme has been created in conjunction with the management of the business.
The business rescue practitioners did not want to reveal how many jobs would be cut or how many shops will be closed.
Staff members affected by the restructuring have received letters in terms of article 189 of the Labour Act.
Ellerines will also consult with the union Saccawu and the process is being facilitated by the Commission for Reconciliation, Mediation and Arbitration (CCMA).
READ: How African Bank fail impacts Ellerine clients
Matuson and Pema also announced that they have started a process of selling either the whole business or parts thereof.
"The intended restructuring of the business depends on capital...Because the availability of capital is currently uncertain, the business rescue practitioners have started a parallel process of considering offers for the whole business or parts thereof in order to avoid liquidation."
READ: Fear of job losses among Ellerine suppliers
African Bank bought Ellerine Holdings in 2008. Ellerine Holdings owns the chain stores Ellerines, Beares, FunitureCity, Dial-a-Bed, Geen & Richards and Wetherlys.
Die Burger previously reported that there is great interest to acquire the chain stores.
The company has sustained losses of about R3bn since 2009. Ellerine's loss in the 2013 financial year alone was R1.1bn.
"If the business rescue is not successfull, Ellerines will probably be liquidated and that would lead to the loss of most, if not all the jobs," according to a statement by the business rescue practitioners.
ALSO READ: What went wrong ag Ellerine?
* Are you or someone you know affected by retrenchments or closures at Ellerine? Share your story.
* For business news in Afrikaans see Netwerk24.
