Tongaat Hulett Ltd. is a long-established South African sugar manufacturer and agro-processing company that specialises in sugarcane cultivation and maize-based feedstock production.
Mounting financial pressure has once again pushed Tongaat Hulett Ltd., the century-old South African sugar and agri-processing group, to the brink of collapse, as business rescue practitioners prepare to place the company into bankruptcy. Sources familiar with the matter say efforts to secure funding have fallen short, increasing the risk of liquidation.
The company’s prospective partners; Vision Group and the Industrial Development Corporation (IDC) have been in negotiations to secure financial backing but missed critical deadlines. Although a funding agreement could still be concluded if liquidation proceedings begin, any such deal would need to follow due legal process and receive approval from the IDC’s board.
Robert Gumede, a Vision Group member, described the failure of the rescue plan as unfortunate but stressed that Vision’s shareholders remain committed to saving Tongaat’s South African operations.
As part of the proposed rescue, Vision Group had agreed to assume 11.7 billion rand (about $735 million) of the company’s debt an obligation that would remain even if liquidation proceeds. The plan centred on a debt-to-equity restructuring designed to prevent bankruptcy, with liabilities acquired from Investec, Absa Group Ltd., and Nedbank Group Ltd..
Tongaat employs thousands of workers and supports tens of thousands more indirectly. Its troubles date back to 2019 following a major accounting scandal, and it was formally placed under administration three years later.
Founded in 1892 and named after the uThongathi River in KwaZulu-Natal, the company operates three mills capable of crushing more than 4.8 million tons of cane annually. Its operations span six Southern African countries: South Africa, Zimbabwe, Mozambique, Botswana, Namibia, and Eswatini.