LETTER: So many inaccuracies in article on Tongaat Hulett
The contention by Harry Smit that Tongaat’s board is seeking to extend the closed period in a bid to ‘hide’ is false
Your recent article on Tongaat Hulett unfortunately perpetuated several misleading narratives about Tongaat and the processes to degear the balance sheet (“Tongaat requests JSE suspension amid shareholder flak,” July 15).
As Tongaat was not given the opportunity to clarify or comment upon these important issues, in the interests of fairness and transparency it is essential to highlight the following misperceptions.
Far from being without a chair, I was appointed interim chair of the Tongaat board on May 20. As the former lead nonexecutive director from June 20 2020, I have been in a prominent position on the board as the comprehensive turnaround strategy gained momentum. I believe I am well placed to lead the board as the process advances.
We have also previously clarified the situation around the management of the Zimbabwe assets. The contention that the business has been remotely managed from SA, and that management had not visited the operations for 10 years, is patently false. The Zimbabwe business has a robust local senior management team, and the senior executive committee based in SA regularly visit the country and its key stakeholders.
The contention by Harry Smit that the board is seeking to extend the closed period in an attempt to “hide” is also false. The JSE had already begun the process of reviewing the suspension of Tongaat’s shares when the voluntary request for suspension was made, as unavoidable delays to the results had been communicated to the exchange in line with our requirements as a listed entity.
As we described in our Sens announcement of July 15, Tongaat had hoped to implement a rights offer in the first half of 2022. The delays arising from the action brought by the Artemis consortium before the Takeover Regulation Panel and various competition approvals have shifted the timelines for completion of this process significantly.
The delay in the rights offer, and the ultimate termination of this process, in turn delayed the financing to progress a comprehensive (debt) restructuring solution. This delay affected Tongaat’s ability to release its financial statements for the year ended March 31 by June 30, as required by the JSE. This is due to both the board and the auditor needing more certainty around the debt refinancing and balance sheet restructuring to provide going-concern assumptions as required in the preparation of the financial statements.
I would like to reiterate that it is the board’s belief that the suspension protects the interests of current and potential shareholders as the company engages with multiple parties on solutions to progress the restructuring, and it has no material effect on the company’s financial stability or its business operations.
David Noko
Interim chair, Tongaat Hulett
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