The IRCA liquidation was announced to staff on 1 April 2016, following a business rescue attempt, and a creditors’ vote. UPDATE; Irca sold to Wohbag, see http://sheqafrica.com/liquidated-irca/
IRCA Global was one of the five largest safety, health, environment and quality (Sheq) consulting, training and auditing providers in South Africa.
Independent business rescue practitioner, Dr Gert Holtzhauzen, told Sheqafrica.com that “IRCA staff was at all times kept fully abreast of the rescue process, and were updated on progress made and problems experienced.
“The notice of the Creditors meeting on 1 April 2016 was circulated to all staff members well before the time, and some staff members attended the meeting.
“Due to the creditors vote to not adopt the rescue plan, it was decided to liquidate the company, within the framework of the Companies Act. An announcement was made to staff directly after the meeting.
[Here is a newer report, on the sale of IRCA:
In late February, Dr Holtzhauzen had published details of a proposed business rescue process, in terms of section 150 of the Companies Act. He was appointed in terms of Section 129, since Irca was financially distressed.
He noted that no audit has been carried out, nor has there been adequate opportunity to verify any of the information given to his team by IRCA, except where expressly stated in his report (see the full rescue proposal on the IRCA Global website).
The ledger indicates that IRCA creditors are owed a total of R54.3-m. The Submitted total is R186-m (see a list of the main creditors and amounts below).
During business rescue proceedings, the Practitioner had full management control, in substitution for its board and management.
Irca had only two active directors in recent months; Carel Labuschagne, and Willem van Aswegen as managing director.
Two additional directors were designated in March 2016; Zwelibanzi Bobby Henry Nkosi, and Andile Zamokuhle Nkosi.
“In the event of liquidation of the company, the return to creditors, based on the calculated liquidation and distribution, is zero,” reported the business rescuer in the proposal.
It was “therefore proposed that a compromise of R0.15 in the R1.00 is offered to concurrent creditors [see a partial list of creditors below] in this business rescue plan, which will include the Receiver of Revenue.
“A repayment plan to repay the creditors over an 18 month period, interest free, with no fixed monthly installment,” was proposed.
Rescue plan called for R8.5-m
The business rescue plan had calculated that a capital injection of at least R8.5-m was required to repay post-commencement creditors, and to get working capital, to trade IRCA out of debt (see the larger creditor totals listed below).
As part of the business rescue plan, IRCA had to constitute an effective Board of Directors, and implement proper corporate governance procedures in terms of the King code of Governance.
Cost cutting procedures and efficiency measures were implemented, but belatedly, according to what management told the rescuer.
Irca was registered in 1986 to operate as a Sheq services company. The business consisted of training, behavioural intervention technology, ISO implementation, auditing, risk assessments, software implementation, and quality management systems.
Irca Global had operated 17 branches, in seven countries. Most subsidiary companies recently ran at a loss, mainly due to cutbacks in mining and metallurgy.
IRCA Coastal was a self-funding and a sustainable business entity.
Some loans from the holding companies, BVI and South Africa, have been capitilised into share premium.
The rescuer had aimed to realise viable assets. He reported that he, or the liquidators, would more fully investigate the financial affairs of the company in due course.
Four months ago, IRCA issued notices to its employees of closure of non-viable subsidiaries and divisions, and proposed retrenchment of 10 of its 120 positions.
Some of the IRCA creditors, and their due (listed with Ledger amount; followed by Submitted amount) are;
ABSA Bank Overdraft 6,000,000 6,000,000
AMADAZI INVESTMENTS CC 29,720 49,534
AMOROKO TRAINING 43,070 233,485
ARINT CONSULTING 154,778 419,054
ASSOCIATION OF MINE… 112,080
BLUE VISION ITM 49,500
C Labuschagne (Loan to Irca) 361,423 361,423
CAROL BOUWER 2,540
Charmont Media CC 119,700 104,850
CHARTER QUEST 1,200,000 2,291,845
CST Secretarial Services [submitted] 7,998
Custom SA …
DATA WORLD …
DaVinci Institute students 399 71,256
DINICKS KITCHENS 15,891
Dirk D Haasbroek 13,714
DUNES TUTORING …
FIRST FREIGHT 19,973
Gemcare Products 41,786 41,786
Godfrey Mothobi (Loan to Irca) 496,634 496,634
HESTER HAYWARD 13,065
HJ Wood Properties 1,908,741 1,908,741
IRCA CAPE TOWN 10,226
IRCA DURBAN 2,889
IRCA INDIA -147,422
IRCA VEREENIGING 501,829
IXIA TRADING RUSTENBURG 40,000 155,291
JAXTA CONSULTING 55,000
Justin Nash 3,683
LABOUR WISE 5,198 5,198
Liam Tax AdministratorsCC 8,173 5,723
Malcolm S Paul GBP 150,000; 3,000,000 3,573,900
MASTER BUILDERS ASSOCIATION 4,186
MED-E-DRIVE 125,822 192,000
MGK SOLUTIONS 37,383
MOULDER SKILLS DEVELOPEMENT 7,385
NETWORK ALLIANCE 544,000
NEW MEDIA PUBLISHING 15,400
OFFICE GEAR 184,380 177,341
OPTIMUM UPGRADE BUSINESS SYSTEMS 16,998
Paramedical Consulting Services CC /LifeMed 816 7,044
Quinwood Investments (Loan to Irca) 3,347,355 3,347,355
RISK FREE WORKPLACE 9,480
ROPE ACCESS INSPECTION 209,317
Rossouws Attorneys 626,349 650,000
SAFETY FIRST ASSOCIATION 9,291
SAGE VIP 168,078
SERVO VITA CC 17,270
SG CONVENIENCE GAUTENG 5,003
SIRIUS RISK MANAGMENT 275,311 255,311
SOUTH AFRICAN COLLIERY MANAGERS ASSN 4,560
South African Revenue Services 26,389,399 26,083,873
TARGAID TRUSTED SYSTEMS CC 110,000
THE BUSINESS ZONE /ALIVE TO GREEN 25,080
The Da Vinci Institute for Technology Management 2,599
Venditor Konica Minolta 130,899 235,397
WALTONS Rustenburg 5,666 5,666
Willem van Aswegen (Loan to Irca) 1,288,608 1,288,608
ZEELIE DE KOCK 268,568 471,833
ZEELIE DE KOCK HOLDINGS BVI 855
TOTAL 54,332,297 186,187,228
A claim totalling R 122 609 191 from Origo was rejected, as the debt was subjected to a debt equity swap in the 2011 and 2013 financial years.
Echoes of the Nosa rescue and liquidation saga
Absa had called in its overdraft to Irca, the same step that had triggered the liquidation of Nosa about ten years ago, for a similar amount.
In the Nosa liquidation saga, Nosa was sold for a nominal amount after a brief business rescue attempt by the buyers.
See the update report some months after the IRCA liquidation:
• Sturns Business Rescue Practitioners, 29 February 2016, in terms of section 150 of the Companies Act, 71 of 2008.
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