Automotive parts retailer and wholesaler AutoZone has reportedly voluntarily entered business rescue as it is in financial distress., the decision followed a resolution taken by the AutoZone Holdings board of directors on 1 July 2024.
According to the latest data from Stats SA, 638 businesses in South Africa were liquidated in the first five months of 2024.Ellies, for instance, had a tough period. Business rescue practitioners determined that the company could not be saved and recommended liquidation. Although it tried to pivot into alternative energy, poor execution prevented it from taking advantage of the strong demand for these products, especially in 2023, when the nation experienced a solar boom due to heightened load shedding.
The group opened stores too quickly and needed to stock them with inventory, which utilised its cash reserves and made it challenging to repay debts.However, West Pack said there was a reasonable prospect of being saved, with it now implementing initiatives to restructure the business and drive its turnaround.
The largest contributor to the increased liabilities was interest-bearing debt which rose by R5.7 billion from a year ago.