Tongaat's shares had crashed in the wake of the scandal, and the firm had been battling with a crippling debt pile in its SA operations, which was threating the group's survival. The firm successfully disposed of its starch business, but plans to sell off property in KwaZulu-Natal was derailed, in part as a result of civil unrest in 2021 that hit property values. Covid-19, as well as floods in KwaZulu-Natal, came as additional blows to the more than 130-year old sugar group.
A plan to raise up to R5 billion in a rights issue also failed to materialise, amid controversies centred on underwriter Magister Investments, and Hudson had mooted this as a way to keep the group's sugar operations intact. Tongaat's board then approved a plan in October that included disposing of its non-SA operations, securing investment for its SA business, introducing a five-year debt instrument that would be repaid through land disposals, as well as continuing to recoup money related to its accounting scandal. This, however, was rejected by lenders, sending the group into business rescue.
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Source: News Formal (newsformal.com)
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