Tongaat Hulett says its lenders agreed to extend a deadline for the company to reduce debt to avoid a default. Now it is negotiating the quantum.
Tongaat Hulett's shares fell as much as 27% on Thursday, 29 April, after it said it was negotiating another reprieve on its debt repayment targets and warned of production losses at its SA sugar operations.
CEO Gavin Hudson, who took over in early 2019, has given the sugar producer and land owner a major overhaul after financial mismanagement under its previous management had a devastating impact across its business.
Last July, the JSE hit the company with the maximum fine possible after it breached listing requirements by publishing incorrect, false and misleading financial information to the detriment of investors.
Under Hudson, Tongaat has been disposing of non-core assets to help it pay down debt as part of a financing arrangement agreed with funders in December 2019. Late last year it sold its starch business to a subsidiary of Barloworld, using the R4.54-billion it received to reduce its gearing.
While it met a 31 March deadline to repay at least R6-billion of its SA debt, it failed to meet a revised milestone to sign cumulative...