IFA Fair Zim Hotel & Resort Pty Ltd, the company that owns KwaZulu-Natal’s iconic Fairmont Zimbali Hotel and Resort, has gone into business rescue.
In a statement on Thursday, the company said it had formally applied for business rescue on Wednesday (16 September) because of the COVID-19 pandemic’s impact.
“The consequent stagnation in global economic activity together with the South African Government-imposed National State of Disaster has impacted negatively on our business,” General Manager Wayne Krambeck said.
Hotel particularly affected
The Fairmont Zimbali Hotel was particularly affected by the lockdown and closure of South Africa’s borders, the company said. This is despite a record turnover between November 2019 and March 2020.
Krambeck said although the company has supported President Cyril Ramaphosa’s measures to combat the pandemic, the prolonged lockdown and “limited support” from the government eroded its revenue base.
“The losses that will be incurred in a gradual return to normality with ongoing uncertainty and the possible threat of further restrictions is just not commercially viable. We have been left with no alternative but to apply for business rescue,” he added.
The news comes despite Ramaphosa’s announcement of South Africa’s move to alert level 1. This allows international travel from low-risk countries, subject to containment and mitigation measures, as from 1 October, 2020. Inter-provincial domestic travel was allowed during alert level 2.
“We are ready to open our doors again to the world, and invite travellers to enjoy our mountains, our beaches, our vibrant cities and our wildlife game parks in safety and confidence,” Ramaphosa said.
Pierre Berrange appointed BRP
IFA Fair Zim Hotel & Resort Pty Ltd said it had appointed Pierre Berrange as the business rescue practitioner.
It added, “All stakeholders and suppliers will be contacted by the business rescue team to plan the way forward in accordance with the processes as provided in the Companies Act.”
Nestled in Ballito about 40km north of Durban, the Fairmont Zimbali Hotel and Resort is a popular destination for both local and international holidaymakers.
It is one of the biggest foreign investments in KwaZulu-Natal’s north coast and its closure could have a negative economic impact in the area.