Africa Cellular Towers winds up
Struggling telecommunications infrastructure provider Africa Cellular Towers (AC Towers) has been placed under provisional liquidation, following financial losses and failure to secure funding.
The company, established in 1999 and listed on the JSE's alternative exchange (AltX) in 2006, said yesterday it was placed under provisional winding-up on Friday, as a “major creditor” applied for an urgent provisional liquidation order. This follows the suspension of the company's listing the day before.
AC Towers has informed its shareholders that the period of provisional liquidation would be three months. “Shareholders will be advised of the identity of the provisional liquidator(s) as soon as he/she/they have been appointed and will be kept informed of the situation.”
The company operates three business units offering turnkey solutions - power lines, cellular towers and equipment shelters.
As far back as November last year, AC Towers warned in its trading update that it was in strategic discussions regarding its “going concern prospects, as well as funding requirements”.
Four months after launching a bid to secure funding, the company was still struggling to obtain it and, on 16 March, reiterated a cautionary announcement - the third since November - saying its funding requirements had not yet been finalised.
AC Towers' financial results, for the six months to August (published in December) indicated it had not been able to turn around its loss-making position. In the first half of 2011, the group turned over R109.2 million, compared with R102.8 million in the first half of 2010. It reported a net loss of R54.7 million, an improvement on the previous R85.5 million loss.
As at the end of May, three days before the suspension of its JSE AltX listing, AC Towers' shares were down by 33.3%.
Last month, AC Towers said it had reached an agreement for the restructuring of funding from the Industrial Development Corporation to the tune of R99 million “subject to certain conditions”. However, the company also communicated that a creditor had served a liquidation application against it and advised shareholders to continue exercising caution.
AC Towers CEO Jacques de Villiers says there are currently no details further to the provisional liquidation of the company, but that the market and the JSE would be informed as soon as further developments came to light.
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