Glodina is back after a government intervention of R150 million

News Guy
November 7, 2018
75 Shares 6,378 Views

Glodina, one of South Africa’s largest towels manufacturing company, has restarted its operations today after it closed down due to financial problems.

The factory which has located in Hammarsdale on the outer west of Durban is back up and running after an intervention from the KwaZulu-Natal government.

MEC for Economic Development, Tourism and Environmental Affairs Sihle Zikalala and the CEO of the Industrial Development Corporation (IDC) Geoffrey Qhena officially opened the plant.

Zikalala said that the KZN government intervened because of the turnaround programme of Glodina and to avoid the devastating effects from the closure of the factory on the economy of the region.

“We had extensive engagements with the management and shareholders of Glodina to understand the nature of the challenge, and working together, we devised mitigation strategies,” said Zikalala.

As part of the intervention, a multi-stakeholder task team made up of the Department of Economic Development, Tourism and Environmental Affairs, Trade and Investment KwaZulu-Natal, IDC, and the South African Clothing and Textile Workers Union was established.

According to Zikalala, the department played a crucial role in linking potential investors with Development Finance Institutions such as IDC and KZN Growth Fund.

Zikalala said, “We are very humbled by the swiftness with which the Minister of Economic Development, Mr Ebrahim Patel and the IDC have handled the matter. This is, indeed, how the developmental state should respond to the pressing economic needs of the communities on whose behalf it exists”.

After the completion of a due diligence process, the IDC approved a funding package of R150 million for an IDC-owned entity to acquire the assets from the previous owner, a move that resulted in the factory resuming its operations.

The new factory has committed itself to the retention of more than 211 jobs of the 500 jobs lost when the company closed down.

African News Agency

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