Tongaat Hulett’s liquidation proceedings have been halted after the company received further funding, allowing it to extend its business rescue proceedings.
The company was set to enter liquidation proceedings, but it received an extension of the Post-Commencement Funding (PCF) facility from the Industrial Development Corporation (IDC).
The facility has been extended to 30 June 2026 and increased from R2.3 billion to R2.5 billion.
This gives the company the liquidity it needs to support its ongoing operations pending the finalisation of the transaction.
The KwaZulu-Natal High Court thus granted an adjournment of the provisional liquidation application, with the matter now set down for hearing on 17 and 18 June 2026.
The adjournment was supported by the Business Rescue Practitioners, the IDC, the South African Cane Growers Association, and the Vision Consortium.
The sugar producer’s history dates back to 1892 and has grown into one of the nation’s primary sugar producers, supporting thousands of jobs.
The company was placed in business rescue in October 2022 after an accounting scandal under its former management.
Despite funding from Vision and the IDC, the companies would disagree over further arrangements, which led the business rescue practitioners to apply for liquidation in February.
Tongaat has continued to operate under extremely challenging conditions since the liquidation application was sent in February.
However, employees have received their salaries, growers’ cane payments, and critical off-crop maintenance work has progressed, ensuring operational readiness for the upcoming season.
Although the PCF developments address the company’s short-term liquidity needs, the withdrawal of the liquidation application depends on a concrete transaction that meets the business rescue’s goals.
The postponement of the liquidation proceedings will thus allow parties additional time to progress engagements in this regard.
Source: BusinessTech
