Tongaat Hulett sale agreement paves way for business rescue exit
The deal, announced on Wednesday, 17 June, is expected to help safeguard thousands of jobs linked to the company's operations and South Africa's cane-growing sector.
Business rescue milestone
Tongaat Hulett, one of South Africa's biggest sugar millers with capacity for 2 million metric tonnes, employs thousands of people across South Africa, Zimbabwe, Mozambique and Eswatini.
The company has been under business rescue since 2022 following major accounting irregularities and faced the threat of liquidation earlier this year after Vision Group's long-running takeover attempt appeared to falter.
This put about 250,000 grower and supplier jobs linked to the cane-growing sector in KwaZulu-Natal and Mpumalanga at risk, as well as 2,600 direct jobs at the company.
Vision Group and IDC backing
"The parties have chosen instead to work together to keep Tongaat Hulett operating and to protect the value it holds for its employees, growers, suppliers, lenders, and the many communities across the region that depend on it," they said.
Under the agreement, the Vision Group consortium, led by South African entrepreneur Robert Gumede, will provide the funding required to pay off Tongaat Hulett's debts.
The deal will also see the IDC convert its R2.5bn loan to Tongaat Hulett into equity and become a significant shareholder.
Protecting jobs and operations
The agreement is aimed at preserving the business and protecting jobs across Tongaat Hulett's operations and supply chain.
The company remains one of the region's largest sugar producers, with its operations supporting growers, suppliers and communities across southern Africa.