eBusiness Weekly
Tongaat Hulett’s business rescue practitioners have asked lenders to extend to the timeline for publishing its business rescue plan by about two months until the end of January, and they are expecting a response by Friday.
Tongaat entered business rescue on 27 October after lenders declined to accept a board-approved restructuring plan. Under the Companies Act, a plan must be published within 25 business days, unless lenders or a court says otherwise.
The practitioners met with creditors on Tuesday to provide an update on the business rescue process, saying in a brief statement this included the successful advancement of the initial amounts of urgent post-commencement financing, which had allowed for some payments, including critical suppliers and small growers. Efforts to obtain additional financing continue, the statement read.
The financial distress of Tongaat Hulett had meant the group recently missed a R401 million payment for sugarcane delivered in September, affecting 4 300 growers, but on Saturday representative body SA Canegrowers said some small-scale growers supplying the Tongaat Hulett mills at Felixton, Amatikulu and Maidstone had received payments.
While the group welcomed the payments given the vulnerability of small-scale growers, it also warned that about 300 commercial growers had not yet been paid, with almost 15 000 jobs still at risk.
“It, therefore, remains critical that the business rescue practitioners prioritise the payment to these growers, which will enable payments to other value chain participants including contractors, haulier companies and input suppliers,” chairperson Andrew Russell had said in a statement.
“There also remain questions about Tongaat Hulett’s ability to make timeous payments of more than R345 million at the end of November for the more than 570 000 tonnes of cane delivered in October. If this is not addressed now, the industry may find itself in this same crisis in a few weeks’ time.” — Fin24
