Rentoza, the South African subscription-based technology rental company, has entered business rescue after its board concluded the company was financially distressed.
The local online subscription platform was established in 2017. It used the same subscription model utilised by Netflix, Apple Music and Microsoft – allowing consumers to pay a recurring fee to access products they would not normally be able to afford on a month-on-month basis.
Products on offer included mobile devices, tablets and laptops, and household appliances, such as fridges, microwaves, washing machines and vacuums.
According to a board resolution adopted on 11 June, the directors resolved to place the company into business rescue in terms of Section 129 of the Companies Act.
The resolution, signed by chairperson Polo Leteka, states the board approved the commencement of business rescue proceedings and nominated Mpoti Moalusi as the company’s senior business rescue practitioner.
The board also authorised director Mishaan Ratan to sign and submit all documents required to implement the business rescue process and empowered the business rescue practitioner to lodge the necessary filings with the Companies and Intellectual Property Commission.
Business rescue is a legal process designed to rehabilitate financially-distressed companies by placing them under the supervision of an independent business rescue practitioner.
The practitioner develops a restructuring plan aimed at restoring the company’s viability or, where that is not possible, achieving a better outcome for creditors than immediate liquidation.
The board meeting was held virtually and was attended by chairperson Polo Leteka and directors Chris Govender, Mishaan Ratan, Hlengiwe Makhathini, Muhammed Zaheer Abdulla and Fatima Munshi. Directors Avinesh Reddy and Aviraag Ramdhani were absent.
The company attracted backing from several investors as demand for flexible access to technology grew.
The business rescue process is expected to determine the future of the company and whether it can be successfully restructured, or whether alternative options will be pursued for the benefit of creditors.
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