Basil Read, one of seven major construction and engineering groups that has agreed with the government to speed transformation by selling assets or mentoring black contractors, has been placed in business rescue, amid a crunch in cash-flows. The JSE-listed company said late on Friday it had tried to raise bridge funding for the finalisation of contracts, but that a majority of a consortium of lenders had indicated they would not make this available outside of business rescue. This had come despite the group having managed to raise R300m through a rights offer in February 2018, which was used to improve working capital and settle loans. The share plunged from a high of 21c to close at 2c on the bourse on Friday. The fall from grace comes after the group reported a R743m operating loss in the year to December 2017, from profit of R64m a year earlier. The net loss was R1bn for the period from a loss of R53.6m in 2016. This meant that at year-end the group’s current liabilities of R2.1b...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, Morningstar financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.



Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00.