Business Day: Upward trend in liquidations shows an economy heading deeper into trouble

Clothing retailer Edcon narrowly avoided liquidation early in 2019 when its creditors and landlords threw it a R2.7bn lifeline.

It was too big to fail because its collapse would have put 140,000 jobs on the line. Similarly, business rescue practitioners are working around the clock at construction firm Group Five in a bid to save 3,000-3,500 jobs.

Elsewhere in the country, 1,198 businesses shut their doors in the first seven months of 2019, Stats SA’s liquidation statistics show. Liquidation figures are on the rise despite the trend among financially strained businesses to opt for business rescue as opposed to liquidation.

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By Business Day –

Londiwe Buthelezi