General Manager Wayne Krambeck said the decision to enter business rescue was made to safeguard the interests of all its stakeholders as the Covid-19 crisis continues to disrupt local and global travel and tourism markets.
General Manager Wayne Krambeck said the decision to enter business rescue was made to safeguard the interests of all its stakeholders as the Covid-19 crisis continues to disrupt local and global travel and tourism markets.

KZN’s plush Fairmont Zimbali Hotel enters business rescue

By Karen Singh Time of article published Sep 18, 2020

Share this article:

Durban - The luxury Fairmont Zimbali Hotel has applied for business rescue and will be closed until further notice. A notice on the hotel’s website read: “In light of the COVID-19 pandemic, Fairmont Zimbali Resort will be closing its doors operationally from today until further notice.”

The five-star hotel situated near Ballito is owned by IFA Fair Zim Hotel & Resort Proprietary Limited, who is one of the biggest foreign investments on the North Coast of KZN.

General Manager Wayne Krambeck said the decision to enter business rescue was made to safeguard the interests of all its stakeholders as the Covid-19 crisis continues to disrupt local and global travel and tourism markets.

“The consequent stagnation in global economic activity together with the South African Government-imposed National State of Disaster has impacted negatively on our business,” he said

Krambeck said despite experiencing exponential growth with record turnover from November 2019 to March 2020, the hotel, in particular, faced an unprecedented situation following the lockdown and border closures.

He said while the support President Cyril Ramaphosa’s reasons for implementing the initial lockdown period, the prolonged 176-day lockdown has eroded their revenue base.

The government provided limited support during this period he said.

“The losses that will be incurred in a gradual return to normality with ongoing uncertainty and the possible threat of further restrictions, is just not commercially viable. We have been left with no alternative but to apply for business rescue,” said Krambeck.

Pierre Berrange has been appointed as the business rescue practitioner and will be tasked with formulating a rescue plan to ensure that the best way forward is found for all stakeholders.

Krambeck said all stakeholders and suppliers will be contacted by the business rescue team to plan the way forward in accordance with the processes as provided in the Companies Act.

“The Fairmont Zimbali Resort is...a major role player in the South African hospitality industry with usage from local and national government, local tourism as well as international visitors,” he added.

KZN Department of Economic Development, Tourism and Environmental Affairs(EDTEA) said while they have not received any information regarding this issue, hotels are private entities/companies governed by private laws.

EDTEA spokesperson Nathi Olifant said the Department understands the devastating impact Covid-19 has had on all operations including hotels.

“It is sad to learn of the plight of the hotel, which means there will be fewer choices for tourists...We hope help will come in time for the iconic hotel as it has played a huge role not only on tourism but economic development,” said Olifant.

He said MEC Nomusa Dube Ncube held a Provincial Tourism and Investment Conference (PTIC) with municipal mayors and industry players where ways of tourism recovery were devised yesterday.

In her speech, Dube Ncube said economic activity across the tourism value chain contributes significantly to GDP.

Tourism already provides substantial resources to advance transformation she said.

“We are the link between the success of tourism and the success of transformation. This puts a huge responsibility on our shoulders: the outcome of our deliberations will have a significant impact on the development of our sector and our province,” said Dube Ncube.

Olifant said the consensus of the PTIC is that a lot of work would need to be carried out to ensure that investment is pumped into infrastructure and support of local businesses in tourism.

These include bulk services like roads, water and sanitation to make doing business easy for the tourism industry he added.

The Mercury

Share this article:

Related Articles