Fin24 reports that Group Five, which is conducting retrenchment proceedings, has estimated that it would need to pay out R233m in severance pay as it enters business rescue.  

The group's board did not say how many of its employees would be affected.  The construction and engineering group also confirmed on Thursday that it had received confirmation from the Companies and Intellectual Property Commission (CIPC) of the registration of resolutions placing it and Group Five Construction into business rescue.  Group Five announced on Tuesday that the boards of Group Five and Group Five Construction had resolved to place each of these companies into business rescue in accordance with the Companies Act.  Group Five Construction, a wholly owned subsidiary of Group Five, is facing a cash shortfall of R2.39bn.  The company reported that Group Five Construction was "financially distressed and it was reasonably unlikely that G5 Construction would be able to pay all of its debts".  It added that the construction company was not able to itself generate sufficient working capital or raise it from other Group Five companies or third parties.

• Read a short report by Jan Cronje at Fin24

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