Listed civil engineering group Protech Khuthele, which at the 11th hour last month postponed the release of its financial results for the year to February, has voluntarily applied to be placed in business rescue.
This followed a demand received for immediate repayment for project expenses incurred, and it becoming aware on Friday that the anticipated receipt of R40 million from a substantial debtor may be delayed or not paid in full, which would adversely affect the company’s cash flow.
“As Protech cannot meet its commitments, it has no choice but to lodge an application for business rescue,” it said.
Protech did not identify the major debtor whose payment had been delayed, nor did it specify the amount demanded from the company, or say who had issued the demand.
In a trading update published in March, Protech highlighted problems with a mining infrastructure project in the Democratic Republic of the Congo, where it is a 33 percent joint venture partner with a leading but unnamed South African construction company.
Protech’s announcement about applying for business rescue was released after trading on the JSE had closed.
The shares dropped 24 percent to close at 19c on Friday.