Oppenheimer’s daughters hold the key as Phumelela folds

It’s over, and we’re ready for new beginnings! Phumelela Gaming and Leisure entered Business Rescue on Friday afternoon, and a Post-Start Financing Agreement (“PCF”) has been agreed with Mary Oppenheimer Daughters Pty Ltd (“MOD”).

The financial deterioration of Phumelela Gaming and Leisure (“PGL” or “the Company”), the largest horse racing operator in South Africa, has been well documented.

Turf Talk reports that the implications of the national closure of Covid-19 have exacerbated its problems as today, Friday, May 8, the PGL Board approved a Resolution resolving that the Company enter Business Rescue.

The decision to opt for Business Rescue was preferable to liquidation because the PGL board (“Board”) believes there is a possibility of rescuing the business.

The Board made this decision with the knowledge of a Post-Inception Financing Agreement (“PCF”) agreed with Mary Oppenheimer Daughters Pty Ltd (“MOD”). MOD offered the PCF subject to various conditions, including the Board that made the decision to initiate Commercial Rescue.

PGL is central to the operation of the horse racing industry, and the failure of PGL would have a devastating impact on the entire industry.

It was for this reason that Charles Savage was given the MOD mandate some time ago to interact with PGL. The main objective was to create a sustainable strategy specifically for horse racing in South Africa.

At different times, Mike de Kock, David Abery, Wéhann Smith, and Brian Riley have joined Charles in these efforts.

Susan Rowett

In February 2020, Susan Rowett, as President of the National Horse Racing Authority, called a meeting of various directors and officials from various industry bodies.

At this and subsequent meetings, the decision was made to create a Restructuring Task Force (“RTT”) to engage with PGL to safeguard, capitalize, and restructure the racing industry.

The RTT comprising the aforementioned individuals was accordingly mandated by MOD and endorsed by the industry.

It is important to note that none of these individuals, who together form the Restructuring Task Force (“RTT”), receive remuneration for their work. They have offered their skills as they are fully aligned and committed to the MOD goal as stated above.

It is anticipated that the PCF injection will allow PGL to meet its financial obligations during the Business Redemption process, including the payment of participations at levels agreed with the Career Association during April 2020.

In addition, the agreement provides RTT with the opportunity to negotiate and work with the Business Rescue Practitioner, and through his office with creditors and other interested parties, with the aim of restructuring and recapitalizing the business, thus ensuring the continuity of an industry. viable horse racing. .

“It must be emphasized that the opportunity will be short-lived and will depend on all stakeholders having to make meaningful commitments. The government will be a crucial stakeholder in the future of racing, and while there has been a positive commitment, much work remains to be done.

Many of the negotiations have been and will continue to be subject to confidentiality agreements.

We have been able to guarantee the payment of shares, albeit small, for the foreseeable future. The RTT will communicate with all interested parties when we can do it, “said an RTT spokesperson,

Meet the restructuring team