No More Sugar Coating Tongaat Hulett: A Rights Issue Under Fire - commentary from Hamish Rudland and Chris Logan

Tongaat is looking to raise R5bn in a rights issue that is 12 times its current market value of R400m. The Rudland Family through Magister Investments will partially underwrite R2bn of the rights offer provided that a waiver is approved by regulators. Related parties to Magister were found to have dealt in shares during the restricted period which has influenced the Takeover Regulation Panel’s decision to nullify the waiver. This decision calls into question the certainty of the rights issue and ultimately the future of Tongaat. A body of shareholders’ including shareholder activist Chris Logan, is appealing to Tongaat to reconsider their strategy amid concerns about the intentions of the Rudland family for the business if it obtains control. Hamish Rudland believes a rights issue is the only way forward in order for the company to avoid collapse.  Learn more about your ad choices. Visit megaphone.fm/adchoices