COSATU says the deal protects an estimated 250,000 jobs across the sugar value chain and provides a path toward the company’s long-term recovery.
Tongaat Hulett / Image / hulettssugar.co.za
Cosatu says the potential liquidation of Tongaat Hulett would have been a major blow the country simply can’t afford.
The Durban High Court on Wednesday allowed the company to withdraw its liquidation application.
Rescue plan revived
The move follows an agreement between the Industrial Development Corporation and the Vision Consortium to implement the sugar producer’s business rescue plan.
The liquidation application was filed earlier this year after the rescue plan stalled due to funding challenges.
The IDC has also extended its funding facility to September next year, providing Tongaat Hulett with the liquidity needed to continue operating while the turnaround plan is rolled out.
Cosatu’s Matthew Parks says the agreement means around 250-thousand jobs across the sugar value chain have been saved.
“It is essential that the sugar master plan continues to ensure that the necessary supportive measures to nurture and sustain this important industry are in place, including protecting local growers and emerging farmers from cheap illegal imports.
“Cosatu looks forward to engaging with the IDC and Vision on its vision and plan for Tongaat Hulett and ensure that the needs of workers and their families and communities are placed at the heart of its restructuring and revival.”
Sugar industry relief
The SA Canegrowers Association has welcomed the development, saying it removes the immediate threat of liquidation.
Higgins Mdluli, the organisation’s chairperson says more than 17 500 sugarcane growers rely on Tongaat Hulett’s operations.
While SA Farmers Development Association’s Siyabonga Madlala says it marks a new chapter for the company, its employees and growers who supply its mills.
“We are very much excited to have been part of the difficult times and that we have stood firm and believed in the rescue of Tongaat Hulett. And finally, we believe we are now moving towards a sustainable future. We thank the IDC for their support until this far.”
Meanwhile, Parliament’s portfolio committee on Trade, Industry and Competition says the rescue of Tongaat Hulett must be accompanied by accountability for the events that led to the company’s collapse.
Source: https://www.ecr.co.za/news/news/cosatu-welcomes-lifeline-for-tongaat-hulett/