Post Office stands a chance at a rescue
Business Rescue Practitioners for the South African Post Office (Sapo) think there is a reasonable chance that the state-owned entity can be rescued. According to a press release from the Post Office’s joint Business Rescue Practitioners Anoosh Rooplal and Juanito Damons, this was one of the outcomes of the first meeting of creditors. The said:
Post-Office-stands-a-chance-at-a-rescue
Business Rescue Practitioners for the South African Post Office (Sapo) think there is a reasonable chance that the state-owned entity can be rescued.
According to a press release from the Post Office’s joint Business Rescue Practitioners Anoosh Rooplal and Juanito Damons, this was one of the outcomes of the first meeting of creditors.
The said: “The joint Business Rescue Practitioners (BRPs) are of the view that there is a reasonable prospect of rescuing the Sapo within the ambit of Chapter 6 of the Companies Act.”
They also explained that this is based on the allocated R2.4 billion funding from Treasury in the medium-term budget, the additional funding requirement of R3.8 billion to recapitalise the Sapo, the BRPs interventions and the ongoing support from all stakeholders, including Government, Employees, Trade Unions and Trade Suppliers as well as the Implementation of the restructuring plan.
Rooplal explained how their main objective is to either rescue the state-owned company by restructuring its financial and operational affairs to maximise its chances of survival or provide a better return for the company’s investors.
“Or, if that’s not possible, [in a manner that] results in a better return for the company’s creditors and shareholders that would otherwise have been obtained from the immediate liquidation of the company.” – he added.
It was on the 10th of July 2023 when the order to place Sapo into business rescue was granted and the plan has now been extended to the 30th of November 2023, as agreed upon by creditors. The order came following an application from the Department of Communications and Digital Technologies.
All of this took place after the High Court granted an order for Sapo to be placed into provisional liquidation in February 2023. Mark Barnes who is the former Post Office CEO, revealed in April 2023 that the state-owned entity had already been technically bankrupt for 18 months.
“I’ve looked at the public numbers, and I’ve compared the balance sheet that I signed in 2019 to those submitted to the portfolio committee in 2022, and that told the story of absolute bankruptcy then,” he said.
He also revealed that he had proposed to the Post Office and government that outlined a viable means of “fixing” the entity’s financial situation. However, this fell upon deaf ears. Barnes said he hadn’t received any feedback on his proposal.
