JOHANNESBURG – An application to finally wind up ailing property group Pinnacle Point will be heard on Tuesday further threatening any possible recovery of a R260m invested on behalf of textile workers in Pinnacle Point and raising the question whether this could indeed spell the end of this property firm, should the application be unopposed.
Pinnacle Point announced on Monday that a company called Cape Point Vineyard filed an application at the Cape High Court to convert its business rescue proceedings to a liquidation. Cape Point also wants Pinnacle Point to be put under a final winding-up order at the hands of the Master of the High Court in the Western Cape or alternatively place the company under a provisional winding-up order.
Cape Point Vineyard, which owns 80m shares or just under 1% of the Pinnacle Point Group (JSE:PNG), won a business rescue in July, appointing Mike Lane as a practitioner. Initially it said a business rescue would give some of Pinnacle Point Group’s assets breathing space from creditors, while on the other hand potentially help recover hundreds of millions of rand invested in Pinnacle Point on behalf of thousands of unionised workers.
About R260m of Southern African Clothing and Textile Workers Union (SACTWU) monies were invested in Pinnacle Point Group (PPG). When the business rescue was granted, Cape Point Vineyard owner Sybrand van der Spuy said if Pinnacle Point was totally liquidated these workers would get nothing from their investment. Initially Cape Point Vineyard was underwriting the business rescue and had planned to inject money.
But it looks like things are now falling apart. Sources very close to the matter told Moneyweb that some Pinnacle Point Group creditors and board members did not approve the business rescue proposal as a result, the rescue practitioner, failed to get a buy-in.
One source said with the application for a final winding up, it looked like it was now the end for Pinnacle Point, which is trading at just 1c on the Johannesburg stock exchange. But another source very close to the matter said some lawyers were currently working hard and on standby to oppose the liquidation application on Tuesday.
“There are lawyers who will be opposing this tomorrow,” the source said.
When Moneyweb contacted Pinnacle Point Group and Cape Point Vineyard both companies refused to comment, referring all queries to Lane, the business rescue practitioner. Lane’s office was contacted and Moneyweb was told he is away travelling. We tried calling him on his mobile. But there was no answer.
SACTWU General Secretary Andre Kriel said “We have no legal standing to oppose the liquidation, as the union is not a creditor or shareholder of PPG. However, we will take such steps as we can to help recover the monies in post liquidation proceedings, should liquidation be granted.”