Bosasa, which currently trades as African global Operations, is undergoing voluntary liquidation following a call by the group’s bank to shut all the company’s bank accounts for worry of “reputational damage”.

The company declared on Monday that its bank accounts are closed by the end of February.

The company’s board created the choice to go into voluntary liquidation in line with the obligations of the companies Act that states that if a company won't be ready to pay its creditors within following six months they either have to be compelled to apply for business rescue or voluntary liquidation.

“The decisions created by the monetary establishments aren't supported the African global Group’s liquidity standing, financial stability, operational performance or growth forecasts.

On the contrary, the cluster is each factually and commercially solvent. Tragically, the group are unable to trade while not a bank account,”Bosasa above during a statement.

Bosasa has been the topic of the commission of inquiry into state capture wherever former staff are giving testimony concerning however it's been able to secure a monopoly on government tenders and contracts. Through intensive testimony before the inquiry, that spanned over the period, Bosasa’s former chief operations officer, Angelo Agrizzi disclosed, however, the company had used bribes to political officials and uncompetitive tender processes to secure their grip on business from the state.

The most popularly notable ‘cash cow’ for Bosasa was the correctional services department, however, this influence on contracts additionally expanded to home affairs and alternative departments.

At the beginning of February, the Mail and Guardian reported, however, Bosasa, headed by Gavin Watson, had managed to secure at least R12-billion in state contracts from concerning 40 national and provincial government departments over the past decade.

The liquidation can affect four 500 direct employees at Bosasa that the company estimates can indirectly impact on 25 000 people.

Bosasa aforesaid the liquidation won't affect its current operations and “staff stay used, and we move with our work until educated otherwise”.

Bosasa additionally has 108 youngsters on learnerships, an far more than 3 100 suppliers and contractors, several of that are small businesses, also will be affected.

The company emphasised that it had contributed to improved service delivery within the country by “serving our purchasers with the most effective standards and futuristic solution”.

“We make sure that nowhere and nobody have reported that we've didn't deliver quality service to our clients. we have a tendency to always met/exceeded our client’s expectations,” Bosasa aforesaid.

Bosasa has additionally been running the country’s migrant repatriation centre, Lindela, wherever immigrants have long reported to be subjected to right violations.

Four-year-old Sinoxolo Hlabanzana died after he developed a fever and diarrhoea whereas he was illegally detained at Lindela along with his auntie.

Bosasa has reached out to numerous local and international financial institutions to open a trading account which will permit it to operate beyond March one.

The company says it'll not be creating any further statements on the matter beyond the newest statement.