Distressed JSE-listed sugar producer Tongaat Hulett has announced that it will sell all its assets and operating businesses in South Africa to Vision Sugar South Africa.

The purchase price for Tongaat Hulett's South African assets will be the fair market value determined by an appointed independent valuer, whose decision, absent any manifest error, shall be final and binding on the parties, plus an amount equal to the assumed liabilities, the company said in a statement.

Vision Sugar South Africa is a wholly owned subsidiary of Vision Investments. It will buy Tongaat Hulett's South African assets and operations by way of a set off of the purchase consideration against a portion of the lender group claims.

The transaction is subject to the fulfilment of a number of suspensive conditions.

Further, the sale agreements relating to the non-South African assets, namely the shares and claims held in foreign entities, are still in process and will be signed as soon as the parties are ready to do so.

The successful execution of the adopted business rescue plan presents a reasonable prospect of achieving a positive outcome that aligns with the rights and interests of stakeholders and affected persons. The rationale for the transaction supports the prospects of the continued viability of Tongaat's operational businesses, the company said.

Shareholder approval for an equity subscription was not obtained, and the business rescue practitioners (BRPs) have continued to implement the adopted plan, with the emphasis on switching to the alternative transactions as outlined in the adopted plan, namely involving the sale of all Tongaat Hulett’s assets and operating businesses.

Despite shareholders not having supported the equity subscription in August, the BRPs are legally bound and obligated to proceed with the implementation of the alternative transactions as outlined in the adopted plan.

The BRPs remain of the view that there is a reasonable prospect of a successful business rescue. The end result contemplated in the South African assets transaction will be that Vision Sugar acquires from Tongaat Hulett all of its South African assets.