We won't let tea estates go under
The provincial government will not allow the Magwa and Majola Tea estates to be liquidated, says acting head of the Rural Development & Agrarian Reform Department Zoleka Makina. Makina said the government had sunk R116m into the business rescue process of the two projects in the past three years and had no intention of throwing in the towel now, notes a Daily Dispatch report.
Business rescue administrator Garth Voight had applied to the Eastern Cape High Court (Makhanda) to provisionally wind up the company as he said they had run out of rescue capital to run the two estates.
Voight said he had been forced to send home casual tea workers who were harvesting crops as there was no money to pay them.
Court papers suggest that despite several letters, the government failed to formally commit to a further R26m, which Voight had indicated in September was urgently required to continue the business rescue.
While the company had made significant progress towards sustainability it was not yet out of the woods and required further financial support. When the matter was due to be argued yesterday, it was postponed to early June, indicating there was a likelihood the funding impasse would be resolved, says the report.
It quotes Makina as saying that the government would not allow the liquidation to proceed and said anything published to this effect was ‘misinformation’.
The application has been postponed to 4 June.
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