'Hope isn't a strategy' distressed businesses shouldn't wait for lockdown lift to make a call - PJ Veldhuizen

The list of big businesses in South Africa that are struggling to keep their doors open is growing. It includes Edcon, the owners of Edgars and Jet, that voluntarily placed itself under business rescue, as with Comair and SA Express, while Associated Magazines closed its doors, to name a few. A survey by Statistics South Africa revealed that 42% of the country's businesses are struggling and that they have run out of financial resources to continue operating during the Covid-19 lockdown. PJ Veldhuizen, a Cape Town lawyer from Gillen and Veldhuizen, which specialises in business rescue and directors' liability, says companies in financial distress should not remain in lockdown paralysis. "It's time for businesses to honestly assess their positions and consider options." In an interview with Linda van Tilburg, he said the moratorium granted by the Companies and Intellectual Property Commission during the lockdown period does not apply to third parties, which leaves any business under stress and their directors wide open.