In a strategic acquisition, the Guma Group, under the banner of Terris Consortium, has taken decisive control of the multinational agribusiness Tongaat Hulett, positioning itself as a pivotal player in the sugar industry of Southern Africa.
The consortium, led by business magnate Robert Gumede, has effectively outmanoeuvred the competition by securing the buyout of claims from 12 banks, totalling a substantial R8 billion. This move not only signifies a new era for Tongaat Hulett but also underscores the financial acumen and strategic foresight of the Guma Group.
Terris Consortium, which includes Terris Sugar, is a coalition of business expertise with notable figures such as Rutenhuro Moyo of Remoggo, Amre Youness of Samancor, Nauman Khan of Almoiz Industries and Pepsi Bottling, and the Guma Africa Group. This team of seasoned professionals signed the deal on a Friday afternoon, marking the end of the business rescue process for Tongaat Hulett and ensuring the preservation of thousands of jobs across South Africa, Zimbabwe, Mozambique, and Botswana.
Tongaat Hulett has been an integral part of the job creation fabric in the region, employing 40,000 staff and sugarcane growers in KwaZulu-Natal, with thousands more across neighbouring countries. The company's financial woes, stemming from management's missteps with valuable land parcels, led to its business rescue status. However, with a valuation of around R23 billion, the potential for growth and revitalisation under the new leadership of Terris Consortium is significant.
The consortium’s acquisition strategy was not only timely but also intelligent, as it now holds the majority of the sugarcane plantations, mills, refineries, and undeveloped land in the four countries, along with the existing workforce. The plan is to transition the company out of business rescue and resume the trading of shares, following the approval of the Terris Sugar scheme by the creditors.
Terris Sugar’s takeover is a testament to the consortium’s strategic prowess, bypassing the compromised selected equity partnership (SEP) process and securing over 80% of creditors’ votes—surpassing the 75% threshold required for a successful bid. The commitment includes a R3.6 billion capital injection to rejuvenate Tongaat Hulett’s assets.
The future for Tongaat Hulett under the stewardship of Terris Consortium is not only about sugar production but also innovation, with plans to explore renewable energy generation. This diversification strategy aligns with the Guma Group’s vision of sustainable and integrated business growth.
The deal, confirmed by Terris Sugar spokesperson Rob Bessinger, paves the way for a comprehensive rescue plan for Tongaat Hulett, which will be integrated into the broader business rescue practitioners’ plan. This plan is poised to be the only viable path forward, considering the interests of all stakeholders and ensuring a robust capital foundation for the company’s future.
Guma Group’s involvement in the revitalisation of Tongaat Hulett is a clear indication of its commitment to sustainable business practices, job preservation, and economic growth in the region. The Group’s strategic direction for Tongaat Hulett is set to create a ripple effect of prosperity and innovation in the agricultural sector of Southern Africa.
<p>The post Guma Group Spearheads Revitalisation of Tongaat Hulett first appeared on Guma.</p>