Border Timbers judicial management extended
BORDER Timbers’ provisional judicial management period has been further extended to September 2, 2015, amid indications of possible solution with banks and creditors.
The initial 60 day period which ended on 1 July 2015 was granted by the Master of High Court at the company’s first creditors meeting after Provisional Judicial manager Peter Bailey of KPMG had highlighted that the business is better remaining under judicial management as opposed to final liquidation as value will be lost.
In an interview, Bailey said the return date has been moved to September 2 to allow for possible solutions. “I am working with two possibilities; the banks and creditors perspective and by September we hope to have agreed to a workable solution,” he said.
According to Bailey’s report Border Timbers asset value was $152.05 million as at January 31 2015 and liabilities were at $57.77 million. Three banks, NMB, FBC and Ecobank who are owed a combined $6 mln had opted for an extension of judicial management period arguing that they could now come up with a conceptual framework with timelines on debt restructuring and re-financing.
According to Bailey, the company requires an estimated $2.9 million to fund immediate working capital needs where he said is currently engaged with different potential funders. BTL liabilities comprise mainly of deferred tax of $30 mln arising primarily from the biological assets, while borrowings are at $20 mln made up of $6.7 mln overdrafts and loans now due of $13.3 mln.
The company produces and sells primarily two products rough sawn timber and poles. The major business is the production of RST which contributes about 75 percent to the company’s revenue. It sells its products in Zimbabwe and regional markets.- FinX