CNA: A 130-Year Legacy in South African Retail Comes to an End

Central News Agency, better known as CNA, has had a storied presence in South Africa for over 130 years, but it is on the brink of vanishing after entering business rescue in 2021. This iconic retailer, which has weathered both World Wars, succumbed to a gradual decline exacerbated by modern competition and the challenges posed by the COVID-19 pandemic.

Challenges Leading to CNA’s Decline

CNA faced fierce competition from Australian retailer Typo and various online stationery platforms, leading to a significant drop in consumer demand. Reports from BusinessDay indicate that the retailer struggled to sell its stock, which contributed to its financial woes. In total, CNA accrued debts amounting to R264 million to its creditors, which notably included former employees who had supported efforts to keep the business afloat.

Rescue Efforts and Store Closures

As part of its business rescue operation, CNA shuttered over 80 unprofitable locations, consolidated its head office, and enacted significant salary reductions for management—over 40%. Business rescue is a temporary measure allowing companies to restructure and manage debt to avert liquidation.

A representative from the business rescue partnership, Stacey Roux, stated, “CNA was sold as part of an adopted business rescue plan to a purchaser consortium that included the Everland Group.” However, less than two years post-rescue, reports of a shareholder dispute at the Everland level have surfaced, compounded by subsequent store closures.

The End of an Era

Unfortunately, it appears Everland is also facing liquidation, with the process being administrated by Icon Insolvency Practitioners in Pretoria. The rescue plan aimed to reduce CNA’s operational presence from 163 stores to 55, but the outcome has fallen short of expectations.

The Rich History of CNA

Established in 1896 by Michael Davis and Albert Lindbergh in Johannesburg, then a burgeoning mining town, CNA initially focused on distributing newspapers, including prominent titles like the Rand Daily Mail and Sunday Times. By 1901, the company diversified into bookstores at railway stations and initiated its first suburban branch in Jeppestown.

Rapid growth followed in the early 1900s, with significant contracts from leading publications, propelling CNA to a listing on the Johannesburg Stock Exchange (JSE) in 1903. By 1932, the retailer flourished as the primary distributor of British newspapers in South Africa.

CNA expanded into Zimbabwe in the 1950s and underwent various ownership changes, including a major merger with Gallo Africa in 1983. The company saw its store count swell to 316 by the mid-1990s, but its fortunes turned with time. In 2002, it was acquired by Edcon for R130 million, which included 137 stores. Despite efforts to revive the brand, Edcon sold the business in 2020 to a consortium led by Astoria Investments.

In 2021, CNA was again in distress, leading to more store closures and ultimately its pending exit from the retail landscape.

The Legacy Lives On

While the future seems bleak for CNA, its impact on South African retail cannot be underestimated. The company represented a significant portion of retail history and innovation in the country. As the story of CNA unfolds, it serves as a poignant reminder of the challenges faced by traditional retailers in an evolving market landscape.