UPDATE ON DEBT NEGOTIATIONS AND DELAY TO PUBLICATION OF RESULTS
15 Jun 2022
Tongaat Hulett continues work to find a sustainable financing solution for the Tongaat Hulett group. The Company continues to enjoy support from various stakeholders who recognise the critical social impact that Tongaat Hulett has in South Africa and across the SADC region.
As a key element of this restructuring, Tongaat had hoped to implement a rights offer in the first half of 2022. The delays arising from the action brought by the Artemis consortium before the Takeover Regulation Panel (TRP) and various competition authority approvals have shifted the timelines for completion of this process significantly.
The lender group remains supportive of Tongaat Hulett and the Company is currently engaging with them and other parties to provide liquidity which will provide us with additional time as we work to progress a comprehensive restructuring solution.
Despite our best efforts to meet the stipulated deadlines, Tongaat today advised its shareholders that the process to provide short-term liquidity is going to extend beyond 30 June 2022. As a result, Tongaat will not be able to release its financial statements for the year ended 31 March 2022 by 30 June 2022 as required by the JSE.
It is important to note that the financial statements for the year ended 31 March 2022 are not delayed due to any financial irregularities.
Tongaat remains committed to a recapitalisation and remains firmly of the view that a capital raise is a better alternative to strategic asset disposals, particularly an accelerated disposal programme which is unlikely to realise full value for the assets.
“The recapitalisation process remains a critical focus for the Board and management team, as it will help protect more than half a million livelihoods across South Africa, Mozambique, Zimbabwe and Botswana. We remain committed to continuing this process and while we are making every effort to accelerate this, it is a complex and time-consuming process. I am pleased to say it is also one where we enjoy the support of our key stakeholders across all the countries we operate in,” said Gavin Hudson, CEO of Tongaat Hulett.
THL is still party to an agreement with Magister which provides that THL will proceed with a rights offer partially underwritten by Magister. The agreement is subject to the fulfilment of certain conditions precedent by 30 June 2022. If those conditions precedent are fulfilled on a timely basis, then the agreement will be implemented. If they are not, then the agreement will not proceed.
Shareholders will be updated on further developments as and when they arise.