The joint business rescue
practitioners (BRPs) for Group Five and Group Five Construction on Monday
confirmed that subsidiary companies of these entities would continue to operate
as going concerns, as they do not fall directly into business rescue
proceedings.
This is also the case for Group Five’s
international subsidiaries and holdings. The subsidiary companies comprise
those in the Investments and Concessions and Manufacturing clusters.
Notwithstanding the business rescue
proceedings, the BRPs will be responsible for identifying the optimal way
forward for all of these entities and investments.
As announced on March 22, the BRPs are currently
assessing the status and viability of all ongoing projects and
contracts.
The BRPs are currently also assessing the status,
contribution and needs of the Investments and Concessions and Manufacturing clusters,
and how these should be dealt with in terms of the rescue.
This includes the evaluation of expressions of
interest that have been received and the implementation of sales processes
already under way in respect of a number of these businesses.
Subject to this assessment, teams, clients, joint
venture partners, subcontractors and suppliers will be informed of the status
of each project and the
way forward as a matter of urgency, the BRPs said in a statement on Monday.
The BRPs further highlighted that they have
confirmed with Group Five team leaders that, in the interim period, sites
should not be demobilised until there has been engagement from Group Five
representatives and that safety and stability on project sites
remains a priority.
In addition, the practitioners are in ongoing
contact with the group’s lenders with regard to their group exposures and in an
effort to obtain new funding in the form of “post commencement funding” to
secure operational and employee stability.
In the interim, the BRPs said they would seek to
maintain continuity for employees, but warned that, given the financial distress
prevailing within Group Five and certain projects, as well as
activities going forward, it may be necessary to implement further
retrenchments.
The group continues to operate under the supervision of the BRPs, while the directors of the company remain on the Group Five board. http://www.engineeringnews.co.za/article/group-five-subsidiary-companies-to-continue-operating-as-going-concerns-brps-2019-03-25
