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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.
