'Business rescue' in South Africa is on steroids in 2020
It’s been an extraordinary year for “business rescue” in South Africa.
The New Companies Act introduced “business rescue” to South Africa to help rehabilitate companies in financial distress as an alternative to insolvency.
There have so far this year been 233 business rescue cases filed in South Africa including some major players such as South African Airways (SAA), SA Express, Comair, Edcon, Busby and others.
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Many of these companies were already teetering when the lockdown sent the economy into its deepest recession ever.
The majority of business rescue cases were filed in Gauteng followed by companies in the Western Cape and Kwazulu-Natal (KZN).
A lot of opportunistic investors looking to buy distressed assets are starting to see that they can do so through the formal business rescue process.
The Money Show’s Bruce Whitfield interviewed Dr Eric Levenstein, Director at Werksmans Attorneys.
It’s a reflection of the economy since March. It continues. There’s no doubt about it; we haven’t seen the end of the cycle…Dr Eric Levenstein, Director - Werksmans Attorneys
Business rescue practitioners are busy…Dr Eric Levenstein, Director - Werksmans Attorneys
M&A transactions have been incredibly buoyant… The TGF [The Foschini Group] deal… SAA, who knows how it’ll end up? There’s a lot of money being put in there… Comair is going through an M&A transaction…Dr Eric Levenstein, Director - Werksmans Attorneys
For more detail, listen to the interview in the audio below.
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