Fish River Sun to close its doors
Land claim first blow as negotiations about it being handed over to state continue after appeal abandoned
One community has been fighting for nearly two decades to lay claim to the land on which the Fish River Sun was built, but multiple groups have joined the legal action‚ hoping to benefit from a redistribution of the property.
The resort is expected to be closed by Sun International by end-November. Negotiations about it being handed over to the state are under way.
Cameron McConnachie of the Legal Resources Centre‚ who represents one of the communities involved in the land claim‚ says the case started in 1998.
"The Mazizini community’s claims were only heard in 2010‚ when the court ruled in their favour‚" he says. "This verdict was appealed against by Sun International‚ and when the case was moved to the Supreme Court of Appeal in 2011‚ other communities saw an opportunity to get involved."
The case‚ now involving about 300 families from the Prudo community‚ which McConnachie represents‚ along with nearly 100 families from the Tharfield community and a large representation from the Amazizi community‚ will be heard again on October 30.
Emfuleni Resorts‚ which forms part of Sun International‚ has since decided to abandon its appeal against the 2010 ruling.
This decision was communicated to the Eastern Cape Gambling and Betting Board recently.
"The abandonment of the appeal permits Emfuleni to exercise its rights — which stipulates that there is no further obligation or liability in respect of the Fish River Sun resort‚" gambling and betting board CEO Mabutho Zwane said.
"Emfuleni is involved in negotiations with the minister to transfer the resort to the state as a going concern for the benefit of the local community‚" he said.
According to Zwane‚ any remaining portion of the R30m Emfuleni invested towards refurbishments would be disbursed to beneficiaries identified by the board and Emfuleni‚ in such a manner as to benefit and uplift the local communities.
Sun International headquarters said in a statement on Tuesday that the Fish River resort was opened in 1989. "The resort will close finally at the end of November 2017 unless significant progress is made on interventions proposed by the minister of rural development to continue with the operations."
The company is in negotiations with the staff and representative union over the expected loss of 126 jobs. Sun International said declining profits had contributed to its decision.
"The resort has over the past number of years recorded escalating costs and declining revenues in a depressed economic environment‚ with little prospect of financial recovery. The option to sell the resort has been complicated by an outstanding land claim‚ making this option unviable," Sun International said.
It had considered several cost-saving and revenue improvement alternatives, which had either been implemented or rejected. However‚ these had not improved the financial position of the resort, and the company therefore has no alternative but to close the business, it said.
"Economic pressure and subdued trading‚ taken together with the land claim uncertainty‚ have made cross-subsidisation by the Boardwalk in Port Elizabeth increasingly unaffordable‚" the company said.