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Sactwu foregoes dividends from its investments to save jobs

The Southern African Clothing and Textile Workers Union’s (Sactwu’s) efforts to make a go of struggling clothing manufacturing operations has seen it sacrifice dividend flows in a bid to retain jobs.

In 2013 the union acquired several well-known — but loss-making — clothing operations from Seardel Investment Corporation that were set for closure and which would have seen 2,260 jobs lost. The Seardel assets are now housed in Trade Call Investments Apparel (TCIA), a company owned by Sactwu. Part of the deal saw Sactwu taking a R76m loan from Deneb Investments, the industrial holding firm split off from Seardel.

The loan has no fixed repayment period, but as security, Sactwu had to agree last year to cede its valuable future dividend flows in empowerment investment conglomerate Hosken Consolidated Investments (HCI) and new-look Seardel. Sactwu general secretary Andre Kriel said that the union had been reducing the loan amount through the dividends it has been receiving from HCI. "We are also paying the prime interest rates on the acquisition loan and will carry on until the loan terms are fully paid," he indicated. Under the new Sactwu-TCIA management, the old Seardel manufacturing operation now employs 2,930 staff and still serves local retailers such as Woolworths, Truworths, Edcon and the Foschini Group.