The KZN High Court (Durban) will hear arguments next week on whether to liquidate sugar giant Tongaat-Hulett. Arguments will be presented on Tuesday and Wednesday for and against its provisional liquidation, reports GroundUp.

The SA Canegrowers Association, which represents 27 000 small-scale growers and 1 100 large-scale commercial growers, has painted a dire picture if the company is liquidated.

He said the association and others were talking to all stakeholders to explore ways to prevent liquidation. In recent weeks, it was announced that an independent ‘grower led group’ named GrowerCo had been formed. The group proposed putting ownership of the company in the hands of those involved in the industry.

While the finer details of the plan have never been disclosed, court papers reveal small-scale growers would be included as equity partners and earn returns not only on their sugarcane but a share in equity growth over the long run.

But it appears this proposal has not found favour with the Business Rescue Practitioners (BRPs), who have been running Tongaat’s affairs since it was placed in business rescue in October 2022.

In January 2024, the only rescue plan presented to creditors was that of the Vision Group. Because Vision had previously acquired the lender group bank loans, it became the main controlling creditor. It used this power to approve its own business rescue plan which relied on crucial funding from the Industrial Development Corporation (IDC).

In their application for provisional winding up of Tongaat in February this year, the BRPs said the plan was incapable of being implemented, blaming Vision for ‘changing the goalposts’ by demanding sugar industry reforms and further funding from the IDC.

On the day of the initial court hearing, with the crucial milling season looming, the IDC agreed to increase its funding from R2.3bn to R2.5bn. The matter was postponed until 17 June.

Since then, further affidavits have been filed. The BRPs say there is still no prospect for saving the company and there are no viable alternatives to Vision’s plan, which legally has lapsed.

This would appear to indicate the GrowerCo proposal is off the table, as is another proposal put forward by Vision’s competitor, Mozambique based RGS Holdings.

The BRPs claim the IDC is putting up bureaucratic obstacles to accessing funding. This has been strongly denied by the IDC’s Bongani Miya, according to GroundUp.

 He said the funding was conditional on the BRPs providing monthly budgets.

The IDC had raised ‘concerns’ regarding some expenses put forward in the May 2026 budget, which were not operational in nature.

Vision, which has been accused by some of orchestrating the collapse of business rescue for its own ends, still maintains that ‘as things stand, there are no reasonable prospects of rescuing the company’. 

Shareholder and Intervening party, Abrina Pty Ltd, is opposing liquidation.

Full GroundUp report