Tongaat may sell its HQ
STAGGERING: GROUP’S DEBT NOW STANDS AT ALMOST R13 BILLION
Company hoping to raise R4 billion in new equity on the JSE.
bring down Tongaat Hulett’s debt. This includes the sale of noncore and certain other assets such as Amanzimnyama, but also an equity raise.”
Moneyweb understands that several property companies and KwaZulu-Natal magnates have made offers for the Amanzimnyama property, but are not keen on Tongaat Hulett’s asking price of around R200 million.
Hudson would not go into detail on land disposals under consideration or the land sales that have been concluded in the half-year period. But he did say land sales in a tough property market was a positive and would see about 141 000m2 of new development.
On the planned equity raise, Hudson said he hoped it could be finalised by the first quarter of this year. Tongaat Hulett is hoping to raise as much as R4 billion in new equity on the JSE.
“We have already begun talking to stakeholders about an equity raise and the lifting of the suspension of trade in our shares on the JSE is part of the process,” he said.
As part of the restructuring plan, the group is aiming to bring down its debt by about R8.1 billion by next year. It has already embarked on cost-cutting to the tune of more than R1 billion, which included significant retrenchments last year.
The group on Friday posted a headline loss of R314 million for its half-year to September, which was an “improvement” compared with the R354 million restated loss for the comparable six months of 2018.
Its revenue was down 1.5% to R8.085 billion for the period, while operating profit was up sharply from R315 million to almost R1.3 billion. With the group reporting a basic loss per share of 235 cents, Tongaat declared no interim dividend.
However, it said the basic loss per share was also an improvement compared with the 356 cents loss per share for the corresponding period.
If there is fair value, we will consider all options