Star 2023-12-07

Applications come only a day before Tongaat’s creditors are scheduled to vote on the business rescue plans, which outline two possible suitors for Tongaat. TONGAAT Hulett said RCL Foods & Sugar and the Sugar Association of South Africa (Sasa) had launched urgent High Court applications yesterday to prevent Tongaat’s business rescue proceedings from continuing. The applications come only a day before Tongaat’s creditors are scheduled to vote on the business rescue plans, which outline two possible suitors for Tongaat. RCL sought an interdict to prevent the meeting of Tongaat’s lenders tomorrow and that the business rescue plans be declared unlawful and set aside. RCL has had to make additional payments to Sasa because Tongaat and another sugar producer Gledhow Sugar Company were not paying their statutory industry obligations. Sasa in…

SHARES in British American Tobacco (BAT) slumped 7% on the JSE yesterday after the company said it was writing off R597 billion on some of its cigarette brands, with analysts saying the company had paid too much for these although new products had attained break-even earlier. BAT closed 10.08% lower at R532 on the JSE yesterday as investors weighed future prospects for the company and the effects of the write-off. “Cigarettes are taking a pounding in USA, volumes down. Many headwinds. New products are doing quite well with break-even soon, two years earlier than expected,” said Wayne McCurrie, an analyst with FNB. Other analysts said BAT had “clearly paid too much for the acquisition of Reynolds” a few years ago. Macroeconomic pressures in BAT’s US market were also impacting…

THE EUROPEAN Union (EU) has signalled its full commitment to forge ahead with the phase-out of fossil fuel usage at the hotly-contested COP28, amidst South Africa raising concerns about the EU’s carbon adjustment measures. EU special envoy for climate and environment Anthony Agotha yesterday said the region had a huge interest in energy security, because it did not have a lot of oil and gas, like the US does. Agotha said the EU had weaned itself off Russian gas, from importing 155 billion cubic metres to 40 to 45 billion cubic metres this year in a very short period, while also ramping up its renewable energy. “The EU is staying the course, despite the fact that we have been hit very heavily and you can blame us for…

IN EUROPE, the Caribbean, India and elsewhere, the “fair share” debate between data-hungry over-the-top (OTT) operators and network providers is becoming sharper, providing impetus for South African regulators to move swiftly and decisively to address the issue here. OTT platforms like Netflix, YouTube, Facebook and Spotify have changed how consumers access media and have significantly disrupted the revenue streams and business models of network operators. For example, telcos have seen OTT platforms like WhatsApp, with direct messaging, or Zoom and similar platforms, with voice and video calls, displacing SMS and voice call revenue. But even as the revenues plummet the network providers continue to invest in the underlying infrastructure. This effectively enables OTT operators who overwhelming dominate traffic, but who contribute nothing to the infrastructure’s creation and growth. According to…

THE COMPETITION Tribunal yesterday said that it had granted an application by the Competition Commission to amend its complaint referral against Corobrik and SmartStone Precast. The tribunal is investi- gating a charge by the commission that the two firms divided markets between them, by allocating customers in contra- vention of the Competition Act. The tribu- nal’s order means that the scope of the commission’s referral, which is before the tribunal, will be extended to include a com- plaint of price-fixing in addition to the complaint of alleged market division by allocating customers for the manufactur- ing and supply of bricks, pavers and blocks, in contravention of the Competition Act. The commission applied to the tribunal to amend its referral after it said it uncovered new information during the discovery phase…

THE FNB/BER Civil Construction Index reverted back to its third quarter level in the fourth quarter, meaning that almost 60% of respondents were dissatisfied with prevailing business conditions, but indicators point to a rebound, at least in the short term. The sub-indices painted a more up- beat picture than the overall decline in the index. Growth in activity continued to gain momentum, resulting in better than average overall profitability. “Activity in the civil construction sector has been on an upward trajectory for the past few quarters. However, according to Statistics South Africa it fell back somewhat in the third quarter, contracting in real terms by 0.9% year-on-year”, FNB senior economist Siphamandla Mkhwanazi said yesterday. “The underlying data related to activity, profitability and tender competition are much more positive than what…