Tongaat on brink of collapse, again

Tongaat Hulett, a 134-year-old South African sugar maker, is on the brink of collapse again as its administrators prepare to place the firm into provisional liquidation.

The joint practitioners for business rescue have applied to the High Court to discontinue their proceedings and place Tongaat into provisional liquidation after exhausting all reasonable options, the company said in a statement on Thursday.

The move follows the collapse of the approved rescue plan after the sale agreements with its strategic partner Vision Group lapsed, it said.

Vision and Tongaat’s other strategic partner, the Industrial Development, have been in talks to secure funding but failed to meet certain deadlines, the sugar producer said.

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“It’s most unfortunate that the Vision business-rescue plan has been allowed to fail,” Vision Group member Robert Gumede said in response to questions. “However, Vision shareholders are still committed to save Tongaat South Africa, in particular to save the jobs, the investments and livelihood of sugarcane growers of KwaZulu-Natal rural communities.”

IDC declined to comment and referred questions to the company’s business-rescue managers.

Vision agreed to acquire R11.7 billion ($737 million) of Tongaat’s debt and would remain owed the amount even if the company enters liquidation. Tongaat has since received a letter of demand from Vision stating the sum is immediately due and payable, a claim that has significant implications for its solvency and poses an immediate threat to its survival, it said.

The Vision Group’s plan included a debt-to-equity restructuring initially designed to save the company from liquidation. The debt was taken over from Investec, Absa Group and Nedbank Group.

Other members of Vision include Zimbabwean businessman Rutenhuro Moyo, Egyptian entrepreneur Amre Youness and Nauman Ahmed Khan, the founder of Pakistan’s Almoiz Group.

Tongaat employs thousands of workers and indirectly supports tens of thousands of jobs. It first came under pressure in 2019, when it was hit by a serious accounting scandal. It was officially placed into administration three years later.

Founded in 1892 and named after the uThongathi River in southeastern KwaZulu-Natal province, Tongaat operates three mills with the capacity to crush more than 4.8 million tons of cane a year, according to its website.

The company has sugar operations in South Africa, Botswana, Mozambique and Zimbabwe.

© 2026 Bloomberg

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