The postponement of Tongaat Hulett Limited’s amended business rescue plan to September 2023 will not have an impact on Zimbabwe operations, an official has said.
Tongaat wholly owns Triangle Sugar Corporation (Pvt) Ltd, a Zimbabwean registered entity, which owns Hippo Valley Estates and Triangle Ltd.
The 130-year-old South African sugar maker was last year placed in administration after failing to recover from an accounting scandal that exposed a mountain of debt.
Hippo Valley Estates chief executive Aiden Mhere, in an update on the business rescue process, said the postponement would ensure that the company has additional information on the business rescue plan.
“The Zimbabwean operations, that is, Hippo Valley Estates Ltd and Triangle Ltd, are not under business rescue and are therefore not directly impacted by the business rescue process of THL in South Africa. Further updates will be provided as the process unfolds,” he said.
Mr Mhere said on Friday, June 9, 2023, a notice was issued to affected persons to advise that the business rescue practitioners (BRPs) sought to extend the voting on the business rescue plan from the last stated date of June 15, 2023, to no later than September 30, 2023.
He said, as they have communicated before, the BRPs wanted to publish a rescue plan that contained details relating to the outcomes of specific transactions.
“Since the release of the business rescue plan, the BRPs and the management team in South Africa have continued with discussions with a range of parties.
“The BRPs reached an agreement with relevant stakeholders on Friday, June 9, 2023, that updating the business rescue plan with additional details in terms of the strategic equity partner process and other matters would be in the best interest of creditors before they are requested to vote.
“This will ensure that the company will all have additional information on the Business Rescue Plan,” said Mr Mhere.
Mr Mhere noted that the amended plan will ensure the operational aspects of the business continue, and creditors will only vote on the plan in September 2023.
He said engagement with the eight potential Strategic Equity Partners (SEPs) interested in the acquisition of, or investment in, the whole of THL and/or the SA Sugar businesses and/or parts thereof will continue.
“The same work streams as set out in the originally published Business Rescue Plan take place. Only the timing of events changes, with the sourcing of a strategic equity partner pre-dating the release of the revised Business Rescue Plan,” said Mr. Mhere.
He noted that operational and corporate restructuring will commence after the plan is signed off and there is clarity on the outcome of the SEP process.
Tongaat recently said Zimbabwe’s sugar operations are financially sound and will continue trading in the ordinary course of business.
The group said the operations remain self-funded, operational, and subject to the usual high level of sound corporate governance principles, policies, and procedures.