Picture: MARIANNE SCHWANKHART
Picture: MARIANNE SCHWANKHART

Construction company Group Five has entered into binding agreements for the sale of more assets including European toll and motorway developer and operator Intertoll Europe, its business rescue practitioners said on Monday.

 

The troubled company, which went into business rescue in March, has been selling its assets to pay off debt.

In addition to Intertoll, the group is also selling its structural, mechanical, electrical instrumentation and piping (SMEIP) business. However, it did not provide further details on the prospective buyers of the assets and value of the deals.

Group Five and subsidiary Group Five Construction went into business rescue after experiencing financial problems due to worsening conditions in construction, and they could not raise new debt.

On April 17 2019, Group Five Construction concluded a post-commencement finance loan with lenders which now amounts to R153m, including interest. At the end of February 2019, Group Five Construction’s liabilities were R6bn.

Group Five’s business rescue plan, which its creditors approved in September, has proposed a “measured” sale of the company’s assets.

“We continue to engage in numerous sale processes related to subsidiary companies, operating divisions, properties and shareholdings that may be disposed of in order to relieve the burden of the secured debt owed by the company as well as to provide working capital for the business rescue proceedings,” Group Five's business rescue practitioners said.

In a monthly update, business rescue practitioners Peter van den Steen and Dave Lake of Metis Strategic Advisers on Monday said the sale of the company’s assets remained on track.

Van den Steen and Lake last week announced the sale of Group Five Construction subsidiary Group Five Projects to the privately owned Teichmann Group.

Former Springboks and Sharks captain Gary Teichmann is a director and co-founder of Teichmann Group. 

The business rescue practitioners also said they were dealing with disputes related to the claims of creditors. They said the business rescue plan provided for a dispute resolution mechanism to resolve claims “in an expedited manner and at minimum cost to all parties concerned”.

Creditors with disputes had to submit their claim 30 days after the adoption of the business rescue plan. Creditors approved the plan on September 11 2019.

The disputes relate to, among other issues, the amounts owed by Group Five and the classification of creditors.

njobenis@businesslive.co.za