IN a significant ruling that could save dozens of jobs and revive a once-thriving meat processing operation, the Free State High Court has placed Bloemfontein Abattoir (Pty) Ltd under business rescue, paving the way for a multimillion-rand turnaround plan.
Judge Van Rhyn handed down judgment on 3 October in favour of the abattoir’s managing director, Vincent Graeme Leach, and the company’s 38 employees, who brought the urgent application seeking to convert the company’s provisional liquidation into business rescue proceedings.
The court’s decision allows the abattoir – once a key player in the local red meat industry – to reopen under the supervision of business rescue practitioners Stephanus Steyn and Jaco Grobbelaar, who have been tasked with implementing a viable rescue plan.
Bloemfontein Abattoir, which had been in provisional liquidation since November 2024, was declared financially distressed after years of mounting debt, supply disruptions and management challenges.
According to court papers, the company’s liabilities stood at R62.4 million, far exceeding its assets of R22.8 million, leaving a shortfall of nearly R40 million.
The abattoir’s troubles began in 2022 when an outbreak of Foot and Mouth Disease devastated livestock supply chains in the Free State and beyond.
This led to severe shortages of cattle and a dramatic drop in production and revenue.
Further blows came with unpaid debts totalling R24 million from key customers – including a R20 million loss linked to a company owned by Leach’s brother.
Adding to its woes, operational inefficiencies and a leadership vacuum worsened the company’s financial position.
By late 2024, Standard Bank – its largest creditor – had initiated liquidation proceedings, arguing that the company was “hopelessly insolvent”.
Leach and the employees, represented by advocate Jaco Zietsman, argued that liquidation would destroy jobs and value that could be salvaged through restructuring.
Their proposed business rescue plan included a R10 million post-commencement finance (PCF) injection from investor Craig Sumption, a seasoned financial executive.
Sumption’s investment, the court heard, would fund working capital, restock livestock supplies, pay employees and settle urgent utility arrears – such as the abattoir’s R3 million electricity debt to Centlec.
He also pledged to provide the funding without requiring security, signalling strong confidence in the business’s recovery potential.
The plan envisions a phased restart of operations, focusing initially on beef processing, with ambitions to regain export certifications and access markets in Africa, the Middle East, Hong Kong and the Asia-Pacific.
Letters of support from farmers and suppliers were presented to the court, confirming readiness to resume stock deliveries once operations recommence.
Standard Bank, represented by attorney Riaan van der Merwe, opposed the application, claiming that there was no credible evidence that the company could be rescued or that creditors would fare better than in liquidation.
The bank questioned the viability of the turnaround plan, arguing that the proposed funding was insufficient and that the company’s prospects were “fanciful”.
However, Judge Van Rhyn disagreed, ruling that the applicants had demonstrated a “reasonable prospect” of rescue under section 131(4) of the Companies Act.
“The proposals put forward in the draft business rescue plan are not purely speculative,” the judge stated.
“They consist of a positive plan to protect the interests of a wider group of persons and to improve the prospects of the company being returned to solvency and commercial viability.”
The new management strategy aims to simplify operations and become the lowest-cost producer of deboned beef trim for the South African and export markets.
The abattoir also plans to pursue Halaal certification to access additional markets, including the Middle East.
Business rescue practitioner Steyn told the court that the company’s facilities remain “world-class” and capable of supporting profitable operations once efficiency improvements are made.
Historical data showed that, at its peak, the abattoir employed 175 people and generated profits of up to R10 million per year.
For the abattoir’s 38 remaining employees, the ruling offers a lifeline.
Many had joined the application as co-petitioners, fearing the permanent loss of their jobs and livelihoods.
Judge Van Rhyn acknowledged the human and economic significance of the decision, noting that business rescue serves the public interest by preserving employment and stabilising community-linked enterprises.
The court further ordered that Standard Bank pay the legal costs of the application.
Steyn and Grobbelaar were expected to take immediate control of the abattoir’s affairs, finalise the business rescue plan and convene the first meeting of creditors to ratify their appointment.
If successful, the turnaround could restore Bloemfontein Abattoir to solvency within months – transforming a story of collapse into one of revival.