DURBAN - All eyes are on the KwaZulu-Natal High Court as it prepares to hear the provisional liquidation application by Tongaat Hulett.
The sugar producer filed for provisional liquidation after efforts to rescue the company were exhausted.
The more than 130-year-old company was rocked by an accounting fraud scandal in 2019.
A PwC audit found that key executives had manipulated the company's accounts to inflate profits over several years.
The inflated figures were allegedly used to justify executive bonuses and share options.
As a result, the company was forced to restate its financial results, leading to a R12-billion write-down in value and exposing a debt stockpile of R6.6-billion.
Tongaat Hulett entered voluntary business rescue in 2022. Business rescue practitioners were appointed, and by 2024 an official rescue plan had been adopted.
READ: Former Eskom exec appointed interim Tongaat Hulett CEO
The latest controversy involves more than R1-billion reportedly paid in professional fees linked to findings that have yet to be publicly released.
Despite attempts to stabilise operations, the company has been unable to turn things around, placing thousands of jobs and livelihoods at risk.
Thousands of small-scale farmers in the region could also be affected.
The South African Farmers Development Association (SAFDA), which represents about 25,000 small-scale farmers, says roughly 60 percent of its members operate within the company’s catchment area and would be directly impacted.
It says it is doing everything possible to prevent further fallout.
SA Canegrowers, another key industry stakeholder, is also seeking solutions for its members.
CEO Thomas Funke has expressed concern that insufficient measures have been taken to protect innocent workers from job losses.
Negotiations are continuing behind closed doors in an attempt to avert what some have likened to a corporate governance crisis similar to the Steinhoff saga.