Construction company Group Five is set to sell one of its businesses in a move that could see creditors receive a better payout at the completion of the company’s business rescue.
In terms of the Group Five Construction business rescue plan, which its creditors approved on September 11, secured creditors were expected to receive between 66c and 78c, compared with 18c they would have received had the company been liquidated. On April 17 2019, Group Five Construction concluded a post-commencement finance agreement with a group of lenders which, as at September 18, amounted to R153m, including interest.
According to the plan, such distributions to creditors depended on, among other things, realising “fair value” on the sale of assets through “carefully managed sale processes and aggressive cost management during the business rescue proceedings”.