The company breached the JSE Listings Requirements in 2022.
Picture: Gallo Images/Misha Jordaan
Tongaat Hulett, South Africa’s century-old sugar giant, will officially delist from the Johannesburg Stock Exchange (JSE) on 3 November 2026, leaving shareholders with no hope for a return on their investment.
The business was listed on Africa’s largest stock exchange in 1952; however, the JSE suspended its listing on 20 July 2022 after it failed to publish its annual financial results. The company’s shares have not traded on the JSE since that violation.
Listing on the JSE allows a company to raise money from investors and gives shareholders a platform to buy and sell its shares. However, a company can be delisted if it fails to meet the JSE’s requirements or no longer qualifies to remain listed.
Once delisted, its shares can no longer be traded on the JSE, potentially leaving shareholders unable to sell their investments on the exchange.
No Tongaat Hulett shareholder will receive payment
The note to shareholders released on Monday said the company would not make any payments to shareholders in connection with its delisting from the JSE.
“No offer is being made to shareholders in connection with the removal of listing, and no payment will be made to shareholders in respect thereof,” read the note.
“Following the removal of listing, the shares in the company will be held as unlisted certificated shares by the Company’s Transfer Agent, Computershare Investor Services Proprietary Limited (“Computershare”).
Shareholders to remain in Tongaat Hulett
Tongaat Hulett told shareholders that they will remain shareholders in an unlisted company.
“All shareholders will be issued a share statement in respect of their unlisted holdings in the Company within six business days of the effective date of the removal of listing.”
The company added that it does not expect to make any money after the business rescue process is completed, as it will sell the assets to cover the debt. Tongaat Hulett was placed on business rescue on 27 October 2022.
“On completion of the business rescue process, no value is expected to accrue to shareholders. Shareholders are accordingly advised that they should not expect to receive any future distributions in respect of their shares.”
Business rescue plan rejected
In January 2024, 98.5% of creditors backed a rescue plan proposed by the Vision consortium. Vision acquired the debt claims of lenders owed more than R8 billion. The initial plan involved converting debt into shares, which would have reduced existing shareholders’ ownership to 2.7%.
However, shareholders rejected the proposal in August 2024, triggering an alternative plan to sell Tongaat’s businesses and assets to Vision before delisting the company from the JSE.
“Following the general meeting held on 8 August 2024, at which shareholders did not approve the equity subscription underpinning the proposed conversion of debt to equity, the Adopted Plan placed an obligation on the BRPs to implement the alternative transaction provided for in the Adopted Plan, being the sale of all of the Company’s assets and businesses, as going concerns and as a group, to the Vision consortium.
“From that point, in terms of the Adopted Plan, the Company’s trajectory was towards becoming a shell company, with no value expected to accrue to shareholders.”
Business saved
In June, the Industrial Development Corporation (IDC), which has provided Tongaat with R2.5 billion in funding during the business rescue, reached a binding agreement with Vision.
The liquidation application was withdrawn, agreements were put in place to sell the South African operations and the company’s interests in Zimbabwe, Botswana and Mozambique, while the IDC is set to convert its funding into shares in the business.
The parties involved say the agreement will help protect about 250 000 jobs linked to the sugar industry.
