Tongaat Hulett faces liquidation as business rescue collapses after 37 months

Practitioners will seek provisional liquidation on 27 February, placing thousands of jobs and KwaZulu-Natal's sugar industry at risk.

Business rescue practitioners will approach the Durban High Court on 27 February to request the provisional liquidation of Tongaat Hulett Limited, placing thousands of jobs and livelihoods in northern KwaZulu-Natal at critical risk after 37 months of business rescue proceedings¹².

The liquidation application follows a demand issued on 8 February by Vision Sugar group, led by South African businessman Robert Gumede and Zimbabwean businessman Rute Moyo, for immediate repayment of R11.7 billion in debt¹. Vision acquired the debt from a group of banks led by Standard Bank¹.

The practitioners filed their application electronically on 12 February and set a deadline of 13 February for interested parties to formally oppose, giving potential opponents only hours to review documents, obtain legal representation and decide whether to contest the liquidation².

A Mozambican group, RGS, has filed an affidavit opposing the liquidation². The matter raises questions about the conduct of banks, lawyers and the business rescue industry in corporate distress situations²³.

The potential shutdown of Tongaat Hulett's mills would render the harvest due to begin around April virtually worthless, affecting cane-growers, workers, truckers and suppliers throughout the region¹. Commentary in amaBhungane described the business rescue process as having "herded THL into a cul-de-sac at the edge of a cliff"³.

The practitioners' fees accumulated over the 37-month business rescue period remain secure regardless of the outcome¹.

Tongaat Hulett has been described as a crucial backbone of the rural economy in northern KwaZulu-Natal, with the stability of the province's sugar industry and potentially the province itself at stake²³.