JSE-listed construction company Basil Read on Friday announced that the implementation of its business rescue plan was progressing well.

From February to May, the company continued to complete three contracts, while five contracts were in the process of being descoped or ceded to other contractors. Another three contracts had been handed over to clients and the company was engaged in a defects remediation process.

“The performance guarantees had been reduced from R1.1-billion at the outset of the business rescue proceedings to about R744-million. Negotiations with various employers were ongoing to ensure that no further calls on guarantees were made,” said Basil Read in a release, adding that this significantly reduced the contingent liability risk on the business.

Meanwhile, Basil Read continued to pursue a number of contractual claims that amounted to more than R200-million. In the year to date, claims totalling R34-million were settled and the company used those proceeds towards the repayments of post commencement finance (PCF).

With the exception of the employees required to assist with the completion of the contracts, which includes some contracts at Eskom’s Medupi power station, and the remaining staff at head office, all other employees had been retrenched and would receive their full retrenchment packages.

The company continued to sell, through auctions, all surplus plant and equipment. The proceeds of these sales would be used to repay PCF, retrenchment and other business-rescue-related costs.

Basil Read has moved to new premises in Bedfordview and vacated the Basil Read Campus to substantially reduce the costs for the company and its continuing business.

The business rescue practitioners (BRPs) continued to pursue expressions of interest from a number of parties for the remaining noncore assets.

With respect to the mining and development businesses, the BRPs had, in turn, appointed an independent sales adviser to value the business and to adjudicate on any potential offers received. This process was ongoing.

The BRPs believe full implementation of the rescue plan will achieve a better result than liquidation.

Basil Read entered into voluntary business rescue in June last year, mainly owing to lossmaking legacy contracts and lossmaking entities.