Business rescue reprieve for embattled post office
Finance and acting communications minister Enoch Godongwana has welcomed the move to place the ailing SA Post Office (SAPO) under supervision and in business rescue.
Godongwana is acting minister in the Department of Communications and Digital Technologies (DCDT) while minister Mondli Gungubele attends the 2023 session of the International Telecommunication Union council high-level segment in Switzerland, Geneva.
SAPO’s business rescue is to avert final liquidation, after it was placed in provisional liquidation on 9 February. The provisional liquidation came after Bay City Trading 475, to which the post office owed rent, approached the court for such an order.
This was followed by an application by Gungubele for the post office to be placed in business rescue instead of final liquidation. On Monday, Business Day reported the North Gauteng High Court granted SAPO’s business rescue application.
In the DCDT statement, Godongwana says the court’s decision gives SAPO much-needed time and space to restructure its affairs under supervision and implement its turnaround plan.
“SAPO is a strategic government asset that provides vital services throughout the country, especially in remote areas where SAPO is often the main link between residents and the outside world.
“It further uses its countrywide footprint to render such services as the distribution of social grants at its branches, distribution of medication to those in need, various national and international postal services, etc.”
Gungubele adds it is a crucial government service platform that caters to millions of citizens and cannot afford to cease its operations.
Despite its troubles, both former and incumbent DCDT ministers have been determined to hang on to the ailing entity, saying government has no intention to sell the post office.
Former minister Khumbudzo Ntshavheni previously stated the DCDT would work with SAPO management and its board “to reposition the troubled institution to become relevant in the digital era, while working towards the resolution of its financial challenges”.
The terms of the business rescue will see the appointment of Anooshkumar Rooplal and Juanito Martin Damons as joint interim business rescue practitioners, subject to approval by the registrar of financial services and ratification by the majority of SAPO’s creditors.
“The challenge is on SAPO, the department and all stakeholders to live up to the commitments made in the application,” Godongwana concludes.