By Nelson Banya.
South African sugar producer Tongaat Hullet’s business rescue practitioners have reached an agreement to sell the 134-year-old company to Vision Group, the parties said on Wednesday.
The deal to save thousands of jobs will also see South Africa’s state-owned Industrial Development Corporation convert its 2.5billion rand ($154.16 million) loan to Tongaat Hulett into equity and become a significant shareholder.
Tongaat Hulett, one of South Africa’s biggest sugar millers with capacity for 2 million metric tons, employs thousands across South Africa, Zimbabwe, Mozambique and Eswatini.
It has been under business rescue processes since 2022 after major accounting irregularities and faced the threat of liquidation earlier this year after Vision Group’s long-running takeover attempt appeared to falter.
This put about 250,000 grower and supplier jobs linked to the cane-growing sector in KwaZulu-Natal and Mpumalanga provinces at risk, as well as 2,600 direct jobs at the company.
“The parties have chosen instead to work together to keep Tongaat Hulett operating and to protect the value it holds for its employees, growers, suppliers, lenders, and the many communities across the region that depend on it,” they said.
Under the agreement, the Vision Group consortium, led by South African entrepreneur Robert Gumede, will provide the funding required to pay off Tongaat Hulett’s debts, they added in a joint statement.