The Post Office is out of options

The business rescue practitioners in charge of saving the South African Post Office have on two occasions approached government for permission to sell some of the company’s assets and to go the open market for funding in an effort to salvage the embattled entity’s finances. They were rejected on both occasions.

This is according to Post Office joint business rescue practitioner Anoosh Rooplal, who spoke exclusively to TechCentral this week in an episode of TechCentral Show to be published in the coming days.

“There are certain constraints that have been placed on the business rescue practitioners. In a typical business rescue – and when I say ‘typical’, I mean one that is not governed by the public sector – rescue practitioners would ordinarily be free to borrow money externally and to sell assets,” said Rooplal.

“We wouldn’t really need other permissions because we would have all those powers, but the Public Finance Management Act trumps all of this.”

Unlike the private sector, where only chapter 6 of the Companies Act governs the business rescue process, public sector entities are bound by the PFMA and must seek permission from government to exercise certain powers.

Rooplal, who is director and head of corporate finance and restructuring at SNG Grant Thornton, said government is a unique shareholder in that it is at the same time an interested party in the Post Office’s business rescue and “they also set the rules and policies”.

Hanging in the balance

The company’s fate hangs in the balance now after Rooplal and his associate, Juanito Damons, made it clear to parliament recently that the entity cannot avoid liquidation without a further R3.8-billion in funding – this is on top of a R2.4-billion funding tranche received since the entity entered business rescue. After three years of making no mention of the Post Office in the budget speech, national treasury in December 2025 made it clear the funding would not be forthcoming, according to Rooplal.

Read: Post Office on the brink of collapse

The department of communications & digital technologies in November last year issued a request for information inviting potential private sector partners to propose integrations with the Post Office. Rooplal acknowledged that such partnerships could also serve as a source of funding for the Post Office’s revival, but there is a “chicken and egg” problem hampering these initiatives.

Rooplal explained that the prospective partners pitch ideas with the expectation that Post Office infrastructure is at a standard where they can just plug in and do business, but for that to happen, the entity needs the R3.8-billion it has requested to revitalise its physical infrastructure and modernise its IT platforms.

“What we found was partners were not willing to partner until they could see the infrastructure at a certain level,” he said.

As part of the business rescue process, the Post Office went through a round of retrenchments totalling some 5 000 jobs – around 400 of these were terminations for misconduct. Its physical footprint was also rationalised, with the number of open branches dropping from just over a thousand to 657.

The Post Office still employs about 5 500 employees. With operations at a near standstill, salaries have been paid through a R381-million grant from the Unemployment Insurance Fund’s Temporary Empolyer/Employee Scheme and a R150-million “virement” from national treasury.

According to a notice published in the Government Gazette on Tuesday, the Post Office has applied to communications regulator Icasa for a 25-year renewal of its reserved postal service licence, even as Roopla and Damons warn they may have no choice but to file for its liquidation.

Icasa received the renewal application from the Post Office on 30 March 2025 – one day before the existing licence expired. The licence, first granted in 2001, lapsed on 31 March 2025.

The Post Office’s application seeks approval to provide reserved postal services for a further quarter of a century, citing the need to ensure “uninterrupted service delivery” across the country, including in areas covered by its universal service obligations.

Liquidation

But with government funding not forthcoming and no other options at hand, Rooplal said both he and Damons have little choice left but to initiate liquidation proceedings. Chapter 6 of the Companies Act compels business rescue practitioners to file for liquidation when they see no “reasonable prospect of rescue”.

“We requested from the minister to sell assets. None was granted, so we haven’t been able to sell a single asset in the last three years. We also requested consent to borrow money from the external market, seeing as the shareholder (government) wasn’t able to fulfil its commitment – that consent was not granted.

Read: Post Office limps on – for now

“As our resources dwindle and the prospect of funding declines … a commitment of funding has to come into the business, or we as the BRPs would not be acting in the best interest or in our fiduciary duty,” said Rooplal.

TechCentral has reached out to communications minister Solly Malatsi for comment and will update this article should feedback be received.  – © 2026 NewsCentral Media