Grape farm under liquidation threatBy: WERNER MENGES
THE Komsberg export grape and date farm on Namibia’s southern border is teetering on the brink of bankruptcy after it was placed under provisional liquidation on Monday.
The company owning and running the farm, Komsberg Farming, has accumulated debts of more than N$228 million, and is now “factually and commercially insolvent” and unable to meet its day to day financial obligations, it is claimed in an affidavit filed with the High Court in Windhoek.
The allegation is made by Brian Louis, a director of one of the Komsberg Farming’s major creditors, Louis Group South Africa, which asked the court to have the company placed under provisional liquidation.
The order placing Komsberg Farming under provisional liquidation in the hands of the Master of the High Court was given by Acting Judge Kobus Miller on Monday.
At this stage the order is in force until September 10, by when Komsberg Farming itself or other interested persons should show why the company should not be finally liquidated.
Komsberg Farming is heavily indebted to the Agricultural Bank of Namibia. It is legal action taken by the bank in an effort to recover about N$133 million which it claims the company is owing it which prompted the liquidation application by Louis Group South Africa.
Komsberg Farming is owned by Louis Group International, which is a company based in South Africa, with interests in that country, Namibia, Germany, the United Kingdom and Switzerland. Louis Group South Africa is claiming that Komsberg Farming is owing it N$17,2 million, and is unable to pay this debt.
Komsberg Farming, which is currently employing about 200 people, with an additional 800 employed during the grape harvesting season, “has reached the end of its economic and empowerment dreams,” Brian Louis is stating in his affidavit. “Liquidation has, unfortunately, become a harsh reality,” he remarked.
Komsberg Farming owns about 24 387 hectares of land, consisting of the farms Komsberg and Stolzenfels, on the northern bank of the Orange River in the most south-eastern corner of Namibia.
The farms have been valued as being worth about N$130 million, Louis informed the court.
About 200 hectares of the company’s land are under irrigation, with about half a million boxes of quality table grapes produced for the export market each year, Louis stated.
The company expects to harvest grapes with a total value of about N$40 million this year, Louis also stated.
However, Komsberg Farming is now finding itself in such a financial squeeze that it has no funds from which it can generate income to pay staff salaries and wages at the end of this month and beyond that, Louis said in his affidavit. It also has no possibility of obtaining bridging capital in order to secure the harvest at the end of this year, he added.
If Komsberg Farming is placed in provisional liquidation and the company’s liquidators are given the power to raise money to keep the company’s operations going, the liquidators will be in a position to pay the staff their salaries at the end of July and thereafter at least until the 2012 harvest has been secured, Louis stated.
According to Louis, Komsberg Farming owes Agribank about N$105,75 million at this stage. According to Agribank, the debt is substantially more than that.
In mid-April, Agribank filed a case against Komsberg Farming in the High Court, Louis related. The bank is claiming a total of about N$133 million from the company, and also wants the court to allow it to sell Komsberg Farming’s immovable properties in an effort to recover the money it claims it is owed.
If this is allowed, Agribank would not only be favoured ahead of other creditors of the company, but the company’s employees and seasonal harvesters would be losing their jobs and income, and some also their current homes, Louis is claiming.
He informed the court that the major creditors of Komsberg Farming include Agribank, the Receiver of Revenue, which is owed N$42,9 million, Louis Group South Africa, which is owed N$17,2 million, the Colia Louis Family Trust, which is owed N$25,27 million, the Industrial Development Corporation, which is owed N$20,69 million, Standard Bank, with a claim of N$2,7 million, and Bank Windhoek, in an amount of N$1,5 million.