Allegations of fraud shroud Tongaat Hulett's business rescue process
Mozambican company RGS Group Holdings has been accused of submitting fraudulent bank statements during the bidding process for the troubled sugar refinery.
A sugarcane field belonging to the Tongaat Hulett group. Picture: tongaat.com
JOHANNESBURG - The fight at sugar producer Tongaat Hulett has again turned bitter as allegations of fraud overshadow the business rescue process.
Mozambican company RGS Group Holdings has been accused of submitting fraudulent bank statements during the bidding process for the troubled sugar refinery.
RGS Group Holdings eventually lost to Robert Gumede’s Vision Consortium.
Two proposals were initially on the table, with Vision Consortium and RGS Group Holdings vying for control of Tongaat Hulett.
But RGS Group Holdings pulled out of the race at the start of 2024, making it a one-horse race for the company that’s been in business rescue since 2022.
Vision Consortium now alleges that before RGS Group Holdings pulled out of the race on the eve of an all-important shareholders vote, the Mozambican firm had submitted fraudulent proof of funding, claiming to have R2 billion at its disposal for the takeover.
The proof was in the form of a letter purporting to emanate from Absa Bank Mozambique, dated September 2023.
Executives at Vision have now filed a criminal complaint against RGS Group Holdings at the Sandton Police Station.
Despite what appears to be underhanded tactics by competitors, once finalised, the business rescue plan will see Vision Consortium hold a majority share of Tongaat in a debt-for-equity swap – with existing shareholders retaining almost 3% in shares.