Durban – The luxury Fairmont Zimbali Hotel, one of KwaZulu-Natal’s iconic coast hotel that was forced into administration following the devastating blow South Africa’s hard Covid-19 lockdown caused on its business has been rescued.
According to a report, the Capital Hotels Group has reached an agreement with the Fairmont Zimbali Hotel’s Business Rescue Practitioner, Pierre Berrange, to buy the property in a R240 million deal.
The hotel, built on the picturesque Ballito coastline and overlooking the Indian Ocean was forced to retrench 220 staff in October last year after filing for business rescue a month earlier.
The news of the rescue deal was on Friday applauded by KZN MEC for Economic Development, Tourism and Environmental Affairs, Ravi Pillay, who said it would save dozens of jobs at the establishment.
The hotel which was owned by FA Fair Zim Hotel & Resort Proprietary Limited said it had to take the decision to enter into business rescue due the financial impact the hard lockdown had caused.
At the time, General Manager Wayne Krambeck said that despite experiencing exponential growth with record turnover from November 2019 to March 2020, the hotel, in particular, faced an unprecedented situation following the lockdown and border closures.
He said while the support President Cyril Ramaphosa’s reasons for implementing the initial lockdown period, the prolonged 176-day lockdown had eroded their revenue base.
The R240m rescue deal is conditional pending the Competition Commission’s approval and the creditors accepting the business rescue plan.
Reacting to the recent developments, Pillay said: “We are very delighted with this development especially because 143 jobs will be saved as part of the process.
“What is even more interesting is that the potential buyer is planning a multi-million-rand investment on the establishment.
“This means more jobs may be created as part of that process”.
Pillay said this augurs well for the province’s economic recovery efforts.
“The tourism sector was one of those hardest hit by the Covid-19 pandemic.
“This is why it is one of the sectors we will be focusing our attention on as we double efforts to recover the economy across sectors”.
Pillay said as there are encouraging signs of recovery in the tourism sector, it becomes even more important to adhere to all the safety protocols meant to curb the spread of Covid-19.
“We expect visitor numbers to start increasing especially during the Easter season.
“While we encourage domestic visitors to explore our province we are equally working hard to limit the spread of the virus.
“We encourage both the establishments and visitors to adhere to all the safety protocols,” he said.