One of South Africa’s most dramatic corporate collapses has reached a devastating milestone. However, hope remains – business rescue practitioners are championing a last-ditch effort to save what remains of the company and throw a lifeline to employees.
By Michelle van der Spuy, senior journalist at African Farming and Landbouweekblad
As Daybreak Foods’ retrenchment process nears completion, with 1 896 employees having lost their jobs, a planned recommissioning of one of the abattoirs at the struggling poultry producer could save hundreds of jobs.
Tebogo Maoto, senior business rescue practitioner of Daybreak Foods, says the employees have already received retrenchment notices with about 440 employees to retain their positions. This remains subject to the completion of retrenchment procedures across the company. According to him, the process was expected to be finalised by 3 April.
Daybreak Foods has been under business rescue since 12 June last year after it was unable to pay its employees and service providers. It also lacked the financial resources to feed its chickens. As a result, the National Society for the Prevention of Cruelty to Animals had to cull thousands of starving birds.
Maoto was appointed as business rescue practitioner on 22 May with the aim of saving approximately 2 800 jobs and securing a return for Daybreak Foods’ investors. He says the retrenchments were required after the company’s application for the Temporary Employer/Employee Relief Scheme (TERS) was rejected due to its failure to submit audited financial statements by the end of 2025.
The funding secured to date has, however, enabled the implementation of the emergency phase of the business rescue process.
Also read: NSPCA warns of ‘reckless’ plans at Daybreak Foods
Maoto explains additional funding for the reactivation phase has been partially secured and will be used for, among other things, capital expenditure, replenishment of the company’s poultry flock, resumption of operations and restoration of infrastructure.
This funding will not be used for retrenchments or severance packages.
The Public Investment Corporation, Daybreak Foods’ sole shareholder, had spent R1,7 billion by August last year in efforts to support the struggling poultry producer. This included a payment of R400 million to prevent liquidation and enable the company to enter business rescue instead.
Maoto says the company has completed identifying strategic partners and submitted offers to shareholders for review. Meanwhile, technical assessments of the Sundra and Delmas abattoirs are progressing well, with results expected by mid-April to determine the best path for restarting operations.
Daybreak Foods remains committed to developing a sustainable agricultural enterprise that contributes meaningfully to South Africa’s food security and rural economic development, while ensuring long-term value for its shareholders, says Maoto.
Also read:
Daybreak Foods’ business rescue receives another R150 m.
NSPCA files criminal charges against Daybreak board
Daybreak Foods: Neglect of almost 600 000 more chickens exposed
