The High Court has granted an application by Ellies Electronics for the provisional liquidation of its manufacturing unit Ellies Industries.
A fortnight ago, JSE-listed Ellies Electronics announced it would cease funding and file for liquidation of its manufacturing subsidiary, Ellies Industries, and all activities were immediately suspended.
The company cited the continuing government delays in implementing SA’s digital terrestrial television (DTT) programme as contributing to the unit’s operational woes.
Ellies Industries manufactures, sells and distributes various products related to markets in which Ellies serves, including satellite dishes, terrestrial aerials, TV brackets, mounts and shelving solutions.
According to Ellies, this subsidiary had been severely impacted by the lack of movement on the DTT programme.
“Trading volumes had not been sufficient to generate any profit and the low activity over the past year has not allowed the business unit to recover,” the company notes.
Ellies says over the course of five years, it has provided financial assistance and partially subordinated its loan account so as to enable the unit to continue operating but that didn’t help the business.
The implementation of SA’s DTT has been painstakingly slow, with controversies and department leadership changes bogging down the process even further.
The country missed the June 2015 deadline to complete the full switchover. The International Telecommunication Union called on nations to migrate to digital to allow radio frequency spectrum to be freed up for mobile broadband services.
In a statement today, Ellies Electronics CEO Shaun Prithivirajh says: “The application to the High Court followed numerous efforts by the board and management to improve the performance and viability of Ellies Industries.”
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