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Exclusive to the Web: Atlantis Forge liquidators in talks with buyers to save group
September 1, 2009
By Roy Cokayne
The liquidators of Atlantis Forge are trying to negotiate a partnership between a local aviation company and unnamed Italian consortium to buy it as a going concern and save more than 400 company jobs.
Johan Engelbrecht of Icon Insolvency Practitioners said earlier this week that one of the two local bidders for Atlantis Forge, the Western Cape-base automotive component manufacturer, was an aviation company and talks were taking place to try and secure a partnership between the company and the Italian consortium.
However, Engelbrecht cautioned that the automotive component industry was “really shot at this stage so it’s difficult to find proper interest and commitment” from bidders.
Engelbrecht believed the best option was to try and get the local aviation company and Italian consortium to “take hands”.
“It makes a lot of sense. They have already done a due diligence and the equipment can be adapted to the aviation industry,” he said.
However, Engelbrecht said the negotiations were still ongoing and he was trying to get them finalised as soon as possible but the current economic climate was not of assistance in closing the negotiations quickly. The other local bidder is an automotive company.
Engelbrecht added that the department trade and industry was assisting the liquidators in their negotiations with the potential foreign investor in terms of the incentives that were available.
“They [the department] have been very helpful in the current situation,” he said.
Engelbrecht stressed that the liquidators did not want Atlantis Forge’s plant and equipment to leave South Africa or to be sold off piecemeal.
He said the first prize was to get a foreign investor and a local company together and the company’s workforce reemployed.
The services of the more than 400 workers at Atlantis Forge, whose contracts were suspended when the company was placed in provisional liquidation, were terminated in July at their request to enable them to submit claims to the company’s provident fund.
Atlantis Forge stopped operating in February and was placed in provisional liquidation for the second time in April after an agreement was reached between the management of the company and Solidarity.
This agreement followed Arno Van Wyk, the company’s chief executive, lodging an appeal against the judgment to a successful application brought by Solidarity that overturned the provisional liquidation obtained by Van Wyk in the High Court in Bloemfontein in February.
Engelbrecht said Atlantis Forge had now been placed in final liquidation but a meeting with major creditors still had to take place.
Atlantis Forge is 46 percent owned by the Industrial Development Corporation.
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