Despite strong pushback from the RGS Consortium, Durban High Court Judge Rithy Singh has granted temporary relief to the business rescue practitioners (BRPs) to work out a plan to save sugar giant Tongaat Hulett Limited (THL).
A last-minute assurance by the Industrial Development Corporation (IDC), one of THL’s creditors, to extend its post-commencement finance facility until at least the end of June helped secure the adjournment.
The Vision Sugar Group, the largest secured creditor of THL and proponent of the rescue plan, had called for a postponement, citing developments. The matter had been set down for two days in the Durban High Court.
“There are good prospects that we can get this company over the line by June. We want to give the company a chance to survive,” advocate Blou van Kerckhoven SC, on behalf of Vision Sugar Group, submitted to Judge Singh.
Vision Sugar Group is a consortium led by South African entrepreneur Robert Gumede and his counterpart, Zimbabwean businessman Rute Moyo. The group holds just over R11.7 billion in secured claims over THL.
The state-owned IDC has made more than R200 million available, allowing THL to continue operations and giving business rescuers two months to devise a plan.
In total, the IDC has made about R2.3bn available to the rescue process, bringing the overall state contribution to R2.5bn.
The cash-strapped 134-year-old company is facing a temporary liquidation application, brought by the THL BRPs. The rescue process began three years ago.
Advocate Ruan Kotze, representing RGS, rejected Vision’s assertions, accusing the BRPs of effectively bidding on behalf of Vision Group. He also argued that the rescue plan had failed and should be set aside.
“The fact is that Vision does not have the money to implement its own plan. It seems to me there’s no reason to postpone the liquidation,” said Kotze.
The BRPs’ lawyer, advocate Arnold Subeal SC, pushed back, saying the intention of the rescuers was to give THL a lifeline.
“Tongaat Hulett can still be saved. The adjournment grants us an opportunity to go and make our plan and present it to the creditors. We’re not bidding on behalf of Vision, we’re bidding for the company and its employees,” he said.
Granting the draft order, Judge Singh said refusing the adjournment would not be in the best interests of the people of KwaZulu-Natal, who wanted the company saved at all costs. She described THL as a lifeblood and a vital cog of the provincial economy.
Those supporting the postponement included the IDC, the Vision Consortium and SA Canegrowers. While the BRPs also supported the move, they did so cautiously, warning that THL was not out of the woods and needed to meet key liquidity requirements before a withdrawal of the liquidation application could be considered.
The matter will return to court on 17 and 18 June for a possible counter-application. If the liquidation application proceeds, it could have severe socio-economic consequences for rural economies in small towns across KwaZulu-Natal.
It would also spell disaster for hundreds of workers, mills, suppliers and truckers who rely heavily on the sugar cane sector for survival. Close to 20 000 small-scale farmers depend on THL for income, alongside 435 commercial growers and more than 2 600 workers employed in the sector.
The South African Farmers Development Association, which represents dozens of small-scale growers in KwaZulu-Natal, welcomed the adjournment.
“The adjournment allows for a long-term solution to be explored between now and the date of the next hearing for the main case and the counter-application, which is the 17th and the 18th of June 2026,” the association’s chairperson, Dr Siyabonga Madlala, said.
“We wish to commend the IDC for providing the much-needed further post-commencement funding of R200 million that will allow THL to finish off their off-crop maintenance of the mills and be ready to open for crushing for the current season that commenced on the 1st of May 2026.”
Madlala further explained: “Farmers have been waiting with bated breath as to whether THL mills will even open this season, given the uncertainty about the liquidation hearing, the absence of the PFC, while dealing with other challenges like the sugar imports that continue to hit our shores.”
Vision Sugar Group has outlined its turnaround strategy for THL, which includes diversifying the business, among others, by transforming it from a traditional sugar producer into a producer of renewable electricity.
Tongaat Hulett has been granted a temporary reprieve from liquidation after the Durban High Court approved an adjournment, giving business rescue practitioners time to finalise a recovery plan backed by billions in IDC funding
