Spar’s debt pledge

Mark Godfrey, finance director of BWG's majority shareholder, Spar South Africa, was questioned by journalists there over its recent decision to give a €220 million guarantee over the debts of the Irish company. It was pointed out to him that it was higher than had been expected.

Godfrey predicted that the guarantee will never be called upon. "The Irish business never defaulted on its debt in the past, it will always be able to service it," he said. "This company survived one of the biggest crashes in history, the [Irish] economy was almost obliterated, and still it managed to service its debt. That's a lot better than just treading water." The guarantee has also reduced BWG's annual interest rate from 4 per cent to 1.75 per cent. This, he said, would add up to €5 million to BWG's annual profits, which should please its chief executive, Leo Crawford.