Plucked: trouble at Daybreak Foods as Altron halts services

The poultry producer, which has been in the news for all the wrong reasons, has been left without IT services after failing to honour its payment agreements with Altron Digital Business. The suspension is having a troubling operational impact and complicates the business rescue process

- By Lisakanya Venna

Altron Digital Business has suspended IT services at Daybreak Foods, further disrupting critical operations at the poultry producer and complicating its business rescue efforts. “The temporary shutdown of the IT services by Altron Digital Business has negatively affected the business rescue proceedings in respect of the due diligence process,” said Tebogo Maoto, Daybreak’s senior business rescue practitioner.

Key functions including employee communication, payroll processing, payment to essential suppliers and email services have all been impacted, hampering efforts to stabilise Daybreak Foods.

Despite a payment of R1.4-million made on 31 May to restore services, Altron has refused to lift the suspension, citing unresolved historic debt, which is now part of the business rescue legal process.

Altron confirmed that although payments have been received, they did not satisfy the terms of a settlement agreement reached earlier this year to address Daybreak’s long-standing debt. “The issue of non-payment has been a persistent challenge for over 12 months,” Altron said.

It added that it continued providing services and seeking solutions, but was forced to suspend IT operations because of Daybreak’s failure to comply with the agreement. Talks with the business rescue practitioner were continuing in the hope of securing a grace period to resume essential services, and the matter was now with the lawyers Tebogo Maoto. “to find a settlement”.

The IT shutdown compounds an already dire financial and operational crisis. Daybreak held two consecutive online Q&A sessions for creditors and employees — the first on Monday, 23 June, and a follow-up the next day — that laid bare the company’s deepening financial woes and the impact on workers.