Single ‘nibble’ for liquidated Sails

There lies a simile between theatre and liquidation as aspirant actors and purchasers wait in the wings to make themselves heard. The major difference, though, is that whereas most actors are finally heard, those seeking to buy a liquidated company are far less vocal, usually disappearing after so much as a single tentative approach. Whether the single call expressing an interest in SA Independent Liner Services (Sails), in provisional liquidation, will be one of those remains to be seen. A meeting is yet to be set up between the parties. “It’s quite a common thing. You always get people enquiring and nothing ever happens,” says Darusha Moodliar of Sanek Trust Recovery Services. It is an opinion shared wholly by Ian Wicks, founder and former MD of Sails, who tells FTW: “In liquidation cases there is always someone hanging around to try and make some sort of deal.” While not personally aware of anyone wishing to buy Sails, he says: “Whoever would want to buy a company with no business, no ships and no cargo is not a well child at all. “For a deal to be struck, a company (in this case Sails) should theoretically have assets that are worth stripping and an officially deferred loss – the latter only usable if one is intent on trading in the same line of business – which then makes worthwhile an offer of compromise.” Wicks disputes order book debt of R98 million, monies owed to Sails, given that three or four vessels were operating with cargo at the time of the court application for Sails to be provisionally wound up. He believes the amount is more like R40 million. “From the creditors’ point of view, that owed by Sails is in excess of R400 million. “From an assessed tax loss perspective, the company is worth some R142 million so I don’t know how much a company would pay for Sails, perhaps R14 million, equating to around 5 cents in the rand, I suppose.” Moodliar told FTW the liquidators had no interest in Sails cargo as it did not form an asset of the company. The major focus is on tracking freight in the hands of Sails agents and recovering monies due to Sails. Lonrho, major investor in Sails, has commissioned accounting company KPMG to undertake an audit of its books, and barring any objection by creditors, the company should be finally liquidated in early December. Wicks came up with another revelation last week – that Sails, with only two small vessels in service, was at the point of closing down after only 11 months. That was before Lonrho arrived on the scene with US$6 million, the price for 800 000 shares and US$26 million in loan capital, while also understanding a venture of this nature would require US$70 million. He does not agree, in hindsight, that Lonrho actually threw Sails a lifeline by putting money into a cash-strapped business. “If Lonrho had not come on board we would have walked away from Sails and nobody would have got hurt.”