Approval Of Business Rescue Plan: South African Post Office Faces Major Restructuring
In a significant development, the business rescue plan for the South African Post Office (Sapo) has been officially approved by creditors, marking a critical step to prevent the closure of the state entity. Despite facing financial challenges and overdue payments, creditors, who are owed substantial amounts, demonstrated confidence in the restructuring plan.
The approval, confirmed by Sapo business rescue practitioners Anoosh Rooplal and Juanito Damons, follows a vote where 75% of creditors supported the entity’s restructuring initiative. This decision comes two weeks after the publication of the plan, with Rooplal and Damons emphasizing that the restructuring would be more beneficial than opting for liquidation, especially for private entities involved.
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Expressing optimism, Rooplal asserted that the approved plan has the potential to transform Sapo into a financially stable organization. He stated, “We believe with our continued involvement, hard work and detailed strategy, we can restructure the Post Office into a future-proofed business that can provide ‘communications inclusion’ for all South Africans.”
The green light for the business rescue plan also signals a major overhaul, including the retrenchment of 6,000 employees. While the practitioners outlined a phased implementation over two to five years, the plan indicates that staff reductions will commence in the near future.