JOHANNESBURG - There will be no wholesale retrenchments at Tongaat Hulett, according to Vision Group of Companies chairperson Robert Gumede.
Gumede says all jobs at Tongaat Hulett’s factories are secure following years of uncertainty for workers and communities that depend on the sugar producer.
A breakthrough was reached on 16 June when the company’s business rescue practitioners, the Industrial Development Corporation (IDC) and Vision Group concluded an agreement that paved the way forward for the embattled company.
The IDC will provide financing, while Vision Group will contribute funding to settle creditor claims.
Tongaat Hulett’s troubles came to light in 2019 when a PwC forensic investigation uncovered accounting fraud. The report found that senior executives had manipulated financial statements to inflate profits over several years.
The scandal forced the company to restate previous financial results, wiped out an estimated R12-billion in shareholder value and exposed a massive debt burden.
The crippling debt ultimately pushed the 134-year-old company into business rescue in October 2022.
In 2023, former Eskom executive and current Eskom CEO Dan Marokane was appointed interim chief executive after Gavin Hudson stepped down.
READ: Hope for thousands as rescue plan emerges for Tongaat Hulett
Later that year, speculation emerged that Vision Group would acquire the struggling sugar producer.
In January 2024, creditors approved the business rescue plan, paving the way for Vision Group’s acquisition.
However, in April 2026, a consortium approached the Pietermaritzburg High Court seeking the company’s liquidation after Vision Group and the IDC failed to finalise the required funding. The setback threatened to derail the rescue plan.
Negotiations continued behind closed doors in a bid to avert what some described as a corporate governance crisis reminiscent of the Steinhoff saga.
READ: Court to hear Tongaat Hulett provisional liquidation bid
On 16 June, Tongaat Hulett received a lifeline when business rescue practitioners confirmed a funding agreement between the IDC and Vision Group.
Speaking to eNCA, Gumede described the outcome as a hard-fought victory reached at the eleventh hour.
He said the deal represents a “changing of the guard” in South Africa’s sugar industry.
"What is very exciting is not just saving the jobs of our direct employees, but we are saving investments in the rural areas of KwaZulu-Natal," says Gumede.
He added that more than 250,000 jobs linked to the Tongaat Hulett value chain would be protected.
"Tongaat is the only off-taker for mostly the black farmers of KZN," says Gumede.
Gumede believes the acquisition presents an opportunity to grow employment and transform the industry.
One of the biggest challenges facing the company, he said, is the influx of cheap sugar imports from countries such as Brazil and Thailand, which undermines the competitiveness of local producers.
"Our government has signed agreements with the WTO and obviously other governments subsidise their sugar industry," says Gumede.
South Africa’s sugar industry receives no comparable support.
"For every ton of sugar dumped in the country, it costs 100 jobs and not government in its rightful mind will accept that," he says.
As part of efforts to revitalise the sector, Deputy Minister of Trade, Industry and Competition Zuko Godlimpi has been tasked with driving the sugar master plan, aimed at transforming the industry.
Gumede said South Africa can learn from Brazil, where sugar producers have diversified into biofuels, electricity generation and carbon capture.
"This is what we want to do," says Gumede.
"Together with the IDC, we are aligned on this transformation agenda," he adds.
According to Gumede, Tongaat Hulett already generates electricity for its own operations and could eventually expand production for the national grid.
READ: Vision Parties get credit approval to buy Tongaat-Hulett
The company plans to begin with smaller projects in eThekwini before scaling up.
To protect the local industry, Gumede called for stronger tariff protections against unfair imports.
"We are not saying that our government must behave like Donald Trump, but we are saying they must copy what he does to protect local jobs," he explains.