Tongaat business rescue in deep trouble

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Tongaat Noticias

Business Rescue

amaBhungane | Tongaat business rescue in deep trouble

Vision will no longer acquire all the debt, leaving the lender group with a residual claim of at least R3.6 billion.This follows the filing of an explosive final affidavit in a Durban high court challenge to the Business Rescue Practitioners and the Vision consortium selected to buy up about R8.5 billion in crippling debt.

That plan, backed by the lender group, would have seen the Vision consortium take control of Tongaat in circumstances that were already controversial but are now, Powertrans argues, unlawful and improper.The Vision consortium, putatively fronted by local tycoon Robert Gumede’s Guma Agri, will actually be dominated by Zimbabwean businessman Rutenhuro Moyo’s Mauritius-based Remoggo Investments. Remoggo will hold around 56% of the restructured Tongaat business.

"Therein, the BRPs conceded that the Vision Parties have not acquired all of the Lender Group's claims and that they will not do so before the business rescue process is concluded; and announced that the Lender Group would retain a R3.6-billion claim against post business rescue… The BRPs have not informed creditors of these facts."

"The unavoidable inference is therefore that assets will be at risk of being sold in order to discharge the Lender Group's remaining R3.6-billion secured claim. She also points out that due to the delays, Tongaat is now exposed to significant additional interest payments and has not secured the extension of business rescue financing extended by the Industrial Development Corporation.

Naidoo doesn’t care. She notes:"I have stated all along that there are many other affected persons who are aggrieved and share Powertrans' complaints. The fact that other similarly aggrieved and interested persons are assisting Powertrans does not affect Powertrans' right to bring this application.

 

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