Big battle for iconic South African company in business rescue

The new owners of Tongaat Hulett are appealing a ruling that requires them to provide certain documents and disclosure related to their acquisition of the struggling sugar producer.

Tongaat Hulett is currently undergoing business rescue proceedings after experiencing a catastrophic downfall due to an accounting fraud scandal.

Key executives manipulated the company’s accounts to inflate profits over several years. These inflated profits were used to justify top executives’ hefty bonuses and share options.

When the fraud came to light, the company was forced to restate previous financial results, which resulted in a staggering R12 billion write-down in the company’s value.

As a result, the company was shown to be highly overleveraged, with a debt stockpile of R6.6 billion. 

On 27 October 2022, Tongaat Hulett Limited and Tongaat Hulett Development Proprietary Limited entered voluntary business rescue.

In January 2024, the business rescue practitioners (BRPs) announced that creditors voted in favour of the Vision Group’s business rescue plan.

According to Tongaat, the business rescue plan was progressing smoothly, following the Vision Consortium’s R2 billion settlement of outstanding obligations to the lender group in May 2025.

However, this business rescue process has been fraught with problems, complications and accusations of impropriety.

The latest problem reared its head in July this year when the Durban High Court issued a ruling on 4 July 2025 in an urgent application brought by RGS Group Holdings. 

RGS is a family-run business with over 25 years of operation in Mozambique, where it is one of the country’s largest conglomerates. RGS had been bidding to take over Tongaat Hulett alongside the Vision Group.

RGS had published a separate business rescue plan for the company, which was subsequently withdrawn. It has also accused Tongaat’s BRPs of impropriety and made allegations regarding Vision’s Business Rescue Plan for Tongaat Hulett.

Now, the company is seeking more information about Vision’s acquisition of the company, which is why it filed its application at the Durban High Court.

The judgment handed down by acting Judge Zwane directs the Vision Group to provide certain documents and disclosures relating to its acquisition of the former Lender Group’s claims and security. 

Vision explained in a recent press statement that the ruling is limited to disclosure and does not affect the implementation of Tongaat Hulett’s Business Rescue Plan or the integrity of the acquisition itself. 

“Notwithstanding the limited nature of the relief, the Vision Group respectfully believes that the ruling is wrong and intends to appeal it,” the group said.

“The Vision Group confirmed, under oath, that Tongaat Hulett’s assets were not used to fund or secure the acquisition.”

“This has been independently verified by the former Lender Group and accepted by the Business Rescue Practitioners.”

Allegations

The Vision Group said this is the fourth application instituted or driven by RGS regarding the business rescue process and the implementation of the Business Rescue Plan. 

“An earlier urgent application in which RGS sought to interdict the Business Rescue Plan and sought the same disclosure from the Vision Group was dismissed in February 2025 by Judge Nkosi,” the company said.

“RGS had also submitted its own business rescue plan, however, withdrew its plan shortly before the creditor vote, following media reports that RGS had submitted fraudulent proof of funding,” the Vision Group claimed.

“The existence of the fraudulent proof of funding has since been admitted by RGS in an affidavit filed by it in February 2024.”

The Vision Group said that, throughout these allegations from RGS, it has remained focused on delivery, not distraction. 

The company said its acquisition of Tongaat Hulett is progressing, implementation is taking hold, and early results are evident.

“Our commitment is to see this recovery through – for employees, creditors, farming communities, and all those whose livelihoods are dependent on a stable, growing THL. For us, this is what matters.”

The company claimed Tongaat Hulett’s performance is improving, meaning jobs are being safeguarded, supplier relationships are stabilised, and regional value chains are regaining strength.