By Zuko Komisa
Sugar producer Tongaat Hulett has been forced to undergo business rescue.
The board has designated Metis Strategic Advisors’ Trevor Murgatroyd, Peter van den Steen, and Gerhard Albertyn as Tongaat’s business rescue specialists.
Tongaat was placed under new management with a turnaround plan in 2019 after it was linked to an accounting scam.
Following the failure of its R4 billion right issue with the contentious Rudland family through Magister Investments, it was relying on a recently authorized recapitalization strategy for its future.
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It stated in a statement that the R6.6 billion in business debt levels remained significantly over what could be serviced and that delays in the recapitalization process had made the situation worse.
“The South African lender group has informed the company that in all of the circumstances of the restructuring plan, they are unable to support the restructuring plan or to provide the additional funding required. Consequently, the repayment date of the borrowing base facility will not be extended,” said Tongaat.
Wow – South African sugar producer Tongaat Hulett, a major employer in KwaZulu-Natal, is going into business rescue.
— Nick Hedley (@nickhedley) October 27, 2022
It’s heavily indebted and struggling with liquidity problems.
Many causes, including a poor previous management team that’s also facing fraud charges.
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