JSE-listed industrial group Barloworld has advised that it has not reached consensus with fellow-listed Tongaat Hulett about an independent accountant that is supposed to evaluate the terms of a sale and purchase agreement between the companies.
Barloworld in May raised a concern about Tongaat’s starch business, which it intended to acquire, believing that Covid-19-related impacts on the earnings of the business had resulted in a material adverse change (MAC) to the terms of the agreement.
The companies then decided to refer the matter to an independent accountant who would determine if such a change had taken place.
Barloworld first envisioned that the process would take up to eight weeks, however, with the companies not being able to agree on the appointment of one of the two parties identified in the sale and purchase agreement to act as the independent accountant, it now says the process will take longer.
The acquisition cannot proceed if the MAC determination has not been finalised. If the determination has not been made by the longstop date for the acquisition, which is October 31, then the deal will be terminated.