South African Racecourse Owner Faces Bankruptcy

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Phumelela Gaming and Leisure Ltd, which owns the majority of the racecourses in South Africa, is facing bankruptcy, Sporting Post reported on Monday. The company released its unaudited condensed consolidated interim financial results for the six months that ended on Jan. 31, 2020, and reported a loss of R115.1 million. Phumelela may now choose to file for voluntary liquidation. Racing was supposed to resume last Friday, May 1, but South Africa has continued its lockdown protocols due to the coronavirus. The G1 Horse Chestnut S., G1 South African Derby and G1 South African Oaks, which were rescheduled to May 3 from Apr. 25th, are in danger of being lost for the year and have once again been moved, this time to May 10.

The statement read, “As at the date of this results announcement the prospects for horse-racing, other sports events and betting are uncertain and the Board is in no position to provide reliable guidance. The group is operating under onerous conditions, much of which is beyond its influence. Phumelela seeks further negotiations with the broader horse racing community to find a resolution to the dire situation in horse racing and agree commercially sustainable solutions.

“The group remains engaged in discussions aimed at raising capital. Should these discussions not prove conclusive soon, the board will have to decide on whether there is any reasonable prospect that the group's business can be rescued, or whether to make application for voluntary liquidation.

“The board's current view is that even if financial relief can be obtained, a relief package should be negotiated as part of a business rescue plan. The board will make an announcement in this regard in the near future.”

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