Tambankulu Estate, sugar fields which are part of Tongaat-Hulett, located in Swaziland. Picture:SUPPLIED
Tambankulu Estate, sugar fields which are part of Tongaat-Hulett, located in Swaziland. Picture:SUPPLIED

Tongaat Hulett’s SA lenders have agreed to make new credit facilities available to it, the sugar producer says.

The creditors have agreed in principle to make new senior term loan, senior revolving credit and overdraft facilities available.

“The new SA facilities will be used primarily to refinance amounts owing to the SA lenders under existing facilities and to fund general corporate and working capital requirements,” Tongaat Hulett said in a statement on Monday.

The embattled company has been hit by an accounting scandal that has forced it to restate its financials and ask for its shares to be suspended. It has been in debt restructuring talks with SA and Mozambican creditors.

A successful restructuring of its debt is seen as critical to ensure the long-term sustainability of the company. But the deal announced on Monday goes above and beyond a debt standstill, or a break from payments, which the company was first negotiating.

In terms of the latest agreement, there are specific timelines within which repayments must be made on the debt owing to the lenders and contemplates that the company will fund these repayments out of asset disposals and equity capital raisings.

Tongaat said it is making progress with its turnaround plan, which includes the disposal of noncore assets.

The company said negotiations on the debt restructuring in Mozambique continue to proceed positively.

Tongaat expects to release its restated audited consolidated financial statements for the year to March 2018 as well as the audited consolidated financial statements for the year to March 2019 in the week of December 9.

Ahead of the release of its financials, it plans to release information on the findings of a forensic investigation into the company on 29 November.

On Monday Tongaat also announced that its strategy, business and transformation executive, Dan Leseja Marokane, had been appointed as an executive director of the company with immediate effect.

Meanwhile, Tongaat company secretary Maditshaba Mahlari has tendered her resignation and will be replaced by established legal profession Johann van Rooyen as  January 1 2020.

steynl@businesslive.co.za