Sanyati to be liquidated

Johannesburg - An engineering firm owed R60m by the Free State provincial government is to be liquidated, Business Day reported on Wednesday.

A business rescue had been attempted for Sanyati Holdings [JSE:SAN], one of the government's major private partners, but the appointed rescue practitioner Trevor Murgatroyd recommended the company's liquidation on Tuesday.

Murgatroyd made the proposal after Sanyati's rescue plan collapsed.

Sanyati was not sustainable without a substantial capital injection, which was not possible.

The company's bank cancelled Sanyati's overdraft facilities and froze its accounts, effectively strangling the business, he said.

Free State government spokesperson Wisani Ngobeni said the roads department had faced "resource challenges" and regretted the liquidation. Sanyati employees were likely to lose their jobs.

President Jacob Zuma said on Friday the government would take drastic measures to ensure service providers were paid within a month.

Presidency spokesperson Harold Maloka said a national intervention team led by the Treasury was looking at the Free State roads department.

He said the presidency would make sure all government departments paid suppliers within 30 days, as required by the Public Finance Management Act.


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