Business rescue practitioners (BRPs) Dave Lake and Peter van den Steen this month presented the business rescue plans for Group Five Construction (G5 Construction) and Group Five Limited (G5) to shareholders and received an “overwhelming positive vote of confidence” from shareholders.

The business rescue processes for these entities are two legally separate proceedings, with two separate business rescue plans. G5 Construction represents the majority of the businesses and claims and the bulk of the recovery value within the greater G5 group of companies.

A total of 96.1% of G5 Construction shareholders voted in favour of the business rescue plan, surpassing the required threshold of 75%.

As outlined in the business plan, creditors would be about R5-billion better off than would be the case in a liquidation. Through the restructuring and sale of businesses, the BRPs anticipate that between 3 000 and 3 500 jobs will be saved under new ownership. Fasken’s Haroon Laher,

independent chairperson of the committee of creditors, said last week he had “no doubt” that the current business rescue process and business plan were the “best course of action” and he recommended to creditors ahead of the vote that the published business rescue plan be adopted.

This is the first time in a business rescue process in South Africa that an independent creditor committee chairperson is appointed by a committee representing the creditors, which the BRPs believe is in the best interest of creditors to provide them with an independent analysis.

This process was also supplemented by an independent report by PwC outlining the scenario for creditors if the company had gone into liquidation and had not been placed under business rescue.

On successful implementation of the business rescue plan, secured creditors are, in aggregate, expected to receive distributions of between 66c and 78c a share. Concurrent creditors are expected to receive distributions of between 9c and 20c a share.