Consani shuts its doors due to China and rand

Posted On Tuesday, 01 February 2005 02:00 Published by eProp Commercial Property News
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Construction and engineering group has placed its tank container manufacturing subsidiary Consani Engineering into liquidation because of the strong rand and competition from China

Construction IndustryConstruction and engineering group Murray & Roberts has placed its tank container manufacturing subsidiary Consani Engineering into liquidation because of the strong rand and competition from China, the group said on Friday.

About 450 Consani employees face an uncertain future as a result of the liquidation. A Murray & Roberts statement said the employees had, however, received their January remuneration. It said it would make "every effort" to support the employees.

But hundreds of workers reportedly learnt about the liquidation when they reported for duty and found the company's Cape Town premises locked.

Some executive team members claimed they were informed about the liquidation from suppliers who had received letters from liquidators last week.

Financial director Roger Rees said the claims were untrue. "How can suppliers get letters from liquidators when no liquidator has been appointed yet?"

He said Consani management and staff were informed about the move on Thursday last week.

"There may have been a few shift workers who did not get the message and turned up on Friday. The process of liquidation is never comfortable. But I believe that we have followed proper channels," Rees said.

Clement Herandien, Western Cape regional organiser of the National Union of Metalworkers of SA, said the union had received no communication from Murray & Roberts and that the move had come as a "total surprise".

Herandien said 200 workers had been retrenched from Consani last year "possibly in preparing the company for liquidation or for it to be sold". At that stage the union had agreed to a 30% pay cut in a bid to ease the financial pressure on the company.

The rand's strengthening against the dollar has severely affected Consani, the world's leading supplier of liquid and gas tank containers. The company derives all its revenue from exports.

The strong rand has affected the entire local tank container manufacturing industry, source of 65% of the world's containers.

On Friday Rees said that China was SA's biggest competitor in the industry.

Murray & Roberts executive director Keith Smith said: "As stated in our 2004 annual report and in the trading update in October last year, Consani has been under pressure for some time."

 

Last modified on Monday, 21 October 2013 13:06

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