MIRA INFORM REPORT

Report Date :

20.06.2011

IDENTIFICATION DETAILS

Name :	COLIBRI TOWELLING (PTY) LTD
Registered Office :	P.O. Box 253, Uitenhage, 6230
Country :	South Africa
Date of Incorporation :	18.05.1949
Com. Reg. No.:	1949/33638/07
Legal Form :	Proprietary Company
Line of Business :	Manufacturer of Towelling Products such as towels, linen and other home décor

RATING & COMMENTS

MIRA’s Rating :

C

RATING		STATUS	PROPOSED CREDIT LINE
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended

Status :	Dormant Company
Payment Behaviour :	----
Litigation :	----

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – March 31^st, 2011

Country Name	Previous Rating (31.12.2010)	Current Rating (31.03.2011)
South Africa	a2	a2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Assessment:

On contacting the company it was stated by a director that the company has been dormant for the last 2 months. The subject is waiting for new investors and the IDC (Industrial Development Corporation) to insert funds into the business as the company has recently suffered severe cash flow problems and has begun collecting all outstanding debt.

A loan has been signed at the IDC and they are awaiting finalization to be able to proceed trading again.

Please see the letter below attached from the company as well as information on the group attached.

At present we cannot recommend any credit dealings.

Bottom of Form

Dear Sir/ Madam

We ask of you to please take note of the below general back ground of our problem and please be aware that there is a deal eminent that will be very beneficial to creditors vs a liquidation situation. That is why all the large creditors and banks are waiting for finalisation.

As soon as the company becomes operational and cash flow become available we will be very willing to agree to a monthly payback schedule with you. Until then Nedbank is still collecting all our debtors cash flow.

Back ground:

From January 2011 until end March the IDC has started a process to do a Due Diligence on Colibri. (This included funding of a new warper installed in March 2011 and new weaving equipment bought with PI funds) The purpose of the “Due Diligence” was to determine the working Capital needs for Colibri. (This process will first of all determine if Colibri is a viable entity that with the correct funding levels will become profitable and then to determine what these funding levels should be.) This process included a possible new investor(s). Nedbank, as all other banks involved with Colibri, was aware of this process (and supported it) and has been waiting for the outcome as the Bank has moved Colibri to a risk level customer some time ago. Due to the fact that the process exceeded the time frame that Nedbank was prepared to wait for, Nedbank advised Colibri end March, that they are freezing our accounts until the overdraft facility and debtors advances are paid back. They have been collecting our cash flow since then.

On 7^th of April we signed a new “Loan agreement with the IDC” that would pay on certain conditions. One of them being new investors. Until now they are debating and negotiating on how to go forward with this “new investment”. Broad outlines have been accepted and every day we move closer to a deal acceptable to all! They gave us a date of 27May 2011 to plan to start up the business and have delayed this date to 17^th June 2011.

By 7 May 2011 we paid all Nedbank’s overdraft and debtors advances and until now they are not releasing our money, although we now have positive balances on all accounts. They are holding back this money for the property bond that is not called up or late at all. They are holding +/- R60mil of assets for debt of  +/- R5mil and we are contesting their right to it as well!

ABSA and West Bank are aware of the situation and although we are also currently 2 instalments behind they are willing to hold on.

.

ORGANOGRAM

Wednesday, 13 February 2008

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Group Director Stats

Full Names : Hercules Frederick Myburg

ID Nr. : 491222 5069 08 9

Address : 16 Gardenia Street

Durbanville, 7550

Tel. Nr. : 976-4394

Cell Nr. : 083 309 6242

Full Names : Eric Lucius Laubscher

ID Nr. : 590418 5065 08 1

Address : 85 Lourensford Road

Somerset West, 7130

Tel. Nr. : 852 8112

Cell Nr. : 083 441 9816

Full Names : Thomas Hickman

ID Nr. : 600602 5014 086

Address : 4 Eden Road

Claremont, 7708

Tel. Nr. : 671-0324

Cell Nr. : 083 309 6239

Holding Company Details

Business Name : Belgo Textiles (Pty) Ltd

Postal address of business : P.O. Box 3002

Somerset West

7129

Physical address of business : Crompton Street, Strand

Tel. Nr. : (021) 8414100

Fax Nr. : (021) 854 5202

E-mail address : tom@belgotex.co.za

Registration nr. of business : 1999/09045/07

VAT Nr. of business : 43101182482

Income Tax details : 9681/507/03/5

Director of Finance : Tom Hickman

Cell Nr. : 083 309 6239

VISION

The leader in the home and baby textile markets in Southern Africa

o By delighting customers with consistent and reliable service

o Through a dynamic team that excels in growth, renewal and development

o Achieving stated returns benefiting our stakeholders

o While respecting our environment and community within which we operate

To be Colibri - the quality touch

MISSION

The vision will be achieved through:

· Leading by being the preferred supplier of terry toweling and related products

· Delight the customers consistently

o by delivering on time as agreed through the best IT and systems,

o by producing quality as agreed

o by design with excitement and

o By developing innovative products.

· To be a dynamic team,

o Setting clear goals for high performance.

o that continuously improve

o that excel with passion and loyalty,

· Benefiting our stakeholders

o Return on operating assets of above prime

o Grow the value of the company

· Create an environment where the Colibri brand is preferred.

Operating Company

Business Name : Colibri Towelling (Western Cape) (Pty) Ltd T/A Belgotex

Postal address of business : P.O. Box 3002

Somerset West

7129

Physical address of business : Crompton Street

Strand

Telephone Nr. : (021) 853 8666 / 853 7618

Fax Nr. : (021) 854 5202

E-mail address : dmyburg@belgotex.co.za

Registration nr. of business : 2001/023755/07

VAT Nr. of business : 4310182482

Income Tax details : 9681/507/03/5

Director and General Manager : Derick Myburg

16 Gardenia Street

Durbanville

7550

Cell Nr. : 083 309 6242

STATS

• Heads:
• We employ some 389 people, Salaried 59 (man. accounts Jan 2008)
• Tons:
• We buy some 120 tons of cotton yarn per month and weave about 145 000km of weft per week.

· Replacement Value of Assets:

· The insured value is estimated at R63,2 mil. This excludes all buildings.

• Turnover:
• The budgeted turnover for the company is R58.1 mil (R14 mil. were inter group sales). Stats from the June 2008 Budget.

· Products

• Rolls are cut up to be sewn into final products such as face cloths, hand towels, nappies, bath towels, beach towels and bath sheets.
• We also make some niche products such as hooded baby towels and beach bags.

DETAIL OF PRODUCTION PROCESS AT COLIBRI TOWELLING WESTERN CAPE (PTY) LTD T/A BELGOTEX

· Yarns

• We buy in yarns of different counts from the cotton mills:
• some in raw state and
• some in dyed state and mostly from Colibri Uitenhage.

· Beams & Sizing

• Yarns are then warped on beams; we have 2 warping processes:
• Sectional Hacoba Warper / (waxing);

• Direct Warper
• Benninger Sizing machine for sizing. The process of covering the yarn with a starch solution to strengthen the yarn for weaving. The yarn is dried before wound onto the weaver beams.

· Weaving

• The yarn is then loaded onto a loom and woven according to a pattern.
• The prepared beams are then put on 3 types of looms:
• 21 x Dornier Airjets: 8 with electronic Bonas jacquard equipment
• (Age: 6 loom ± 12 years, 15 looms between 2 and 8 years old).
• 1 x N.P. Smit Rapier (Age 20+ years)
• From where terry towelling fabrics are woven onto rolls.
• The weaving shed works 24 hours and 7 days per week.

· Dyeing

· The size is removed through the scouring (bleaching) process.

• Towels are loaded into the dye machines for dyeing (2 Fongs & 1 x Sclavos)

• The de-roper, setter and tumblers are used for drying and tumbling, depending on the need.

· Hemming

• Towels are split into single widths to be long hemmed. The long cut and long hem machines are from Carl Shale.
• The hemmed rolls are then put through a semi manual cross cutter and then cross hemmed on sewing machines, where a care label and barcode are inserted. Some products mostly face cloths are over locked.
• The product is then quality checked, folded, staked and packed for distribution.

Operating Company

Business Name : Colibri Towelling (Pty) Ltd

Postal address of business : P.O. Box 253

Uitenhage

6230

Physical address of business : Algoa Road

Uitenhage

Telephone Nr. : (041) 995 3400

Fax Nr. : (041) 922 7740

E-mail address : tom@belgotex.co.za

Registration nr. of business : 1949/33638/07

Registration Date : 18.05.1949

VAT Nr. of business : 4660101579

Income Tax details (Tax NF) : 9800 00 2710

Director and General Manager : Rob Jonsson

12 Sibelius Street

Port Elizabeth

6070

Cell Nr. : 083 284 4029

Activity : The company manufactures Towelling Products such as

towels, linen and other home décor

STATS

• Heads
• We employ some 438 people @ Jan 2008 in total, Salaried people are 88
• Tons:
• We buy ± 105 000kg of cotton yarn per month.
• We weave ± 102 000kg of cotton fabric per month.

· Replacement Value of Assets:

· The insured value is estimated at R90,1 mil. This excludes all buildings.

• Turnover:
• The budgeted sales for the year June 2006 is R 86.6 mil (R 18,1 mil. were intergroup sales including the dyed yarns for Belgotex (WC))

Yarns and Yarn dyeing

We buy in yarns in raw state of different counts from the cotton mills:

• some are directly used for weaving and
• others are dyed according to need
• yarns are wound on dye cones and processed in a yarn dye vat
• afterwards they are dried in a Fongs drier

Beams

Yarns are then warped on beams; we have 3 warping processes:

• Schlaforst Sectional Warper / (waxing);
• Sectional Benninger Warper / (waxing);
• Direct Warper and Sizing (West Point).

Weaving

The prepared beams are then put on 4 types of looms:

• 20 x Saurer 400 Dobby Rapiers (± 20 years old)
• 6 x Dornier Rapiers with Staubli jacquards (± 16 years old)
• 12 x Dornier Rapiers with dobbies (± 18 years old)
• 3 x N P Smit Rapiers with Bonas electronic jacquards (± 10 years old)

• 3 x Vamatex rapiers
• The yarns are woven according to a pattern from where towelling fabric in roll form are produced.
• The weaving shed works 24 hours 5 days per week with some weekend overtime.

Dye House

• The rolls are passed through the Dye house for desizing and then dyeing.
• We have a new Sclavos fabric dyeing machine and new Fongs yarn dyeing and drying machines
• The drying and tumbling, depending on the need.

Hemming

• Towels are split into single widths to be long hemmed. The long cut and long hem are done manually on sewing machines.
• The hemmed rolls are then put through sewing machines to cross hemmers where a care label and barcode are inserted. Some products mostly face cloths are over locked.

The product is then quality checked, folded, staked and packed for distribution

1,9 Colibri Baby Products (Old HK)

The business consist of a mix of locally manufactured and imported items

· an CMT operation for baby textile products (mostly hooded towels)

o Cutting Room

o 10 to 20 sewing machines

· imported blankets and quilt sets for babies

· Value added (Disney infants) products for the Southern African market.

Employed are 42 weekly paid and 12 monthly paid = 54 heads

Extract from budget plan: dd 06/2008

SHORTENED CV

DIRECTORS

NAME : Hickman, Thomas Myburg, Hercules Frederick Laubscher, Eric Lucius

BIRTH : 02/06/1960 22/12/1949 18/04/59

SCHOOL: HJS Paarl, 1978 Grey College, Bloemfontein, 1967 Grens, East London, 1977

POST SCHOOL:

B. Com (Stellenbosch), 1982 B. Sc (Bloemfontein), 1971 B. Com (U.P.E.),1983

B. Compt (Hons) – Unisa, 1986 M.B.A. (Stellenbosch), 1992 B. Com (Hons) – Unisa,

1988

Qualified CA (SA), 1987

MBA (Stellenbosch), 1992

CAREER:

- Internal Audit SANDF 1983–1984 - Experimental Physicist, 1972 - Standard Bank A.T.P., 1984

- NDP Audit team leader - Physicist – UOFS Medical Fac. 1973–1974- Tek Electronics

- Theron du Toit Auditors - Wolnit (Pty) Ltd, 1975–1987 - Personnel Officer, 1985–1986

(Article Clerk), 1985-1987 (Dyehouse Manager) - Personnel Manager, 1987–1989

- Todays Frozen Foods (Bokomo) Head Q/C - I.R. Senior Consultant (Guillam B&A), 1989

GM: Finance & Systems, 1988-1990 Technical Manager - Pep Group

- Kohler Trays: Bakke/Sunpak Factory Manager Personnel Manager: Acrytex, 1990

Div. Financial Director, 1990-1994 - Woolworths Head Office, 1987-1989 Manufacturing Manager: Acrytex, 1991-1994

- Pep Group: Senior Technologist General Manager: Acrytex, 1995-1997

GM: Printcor, 1995-1996 Knitwear/Socks & Pantihose General Manager, Belgotex, 1997-1999

FD: Pep Manufacturing, 1996-1997 Pep Group, 1989-1999 Belgotex Director (Sales), 1999

MD: Pep Manufacturing, 1997-1999 GM: Socks/Pantihose/Elastics

- Belgotex Director (Finance), 1999 – Belgotex Director (Manufacturing), 1999
-

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.93
UK Pound	1	Rs.7243
Euro	1	Rs.63.62

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
----	NB	New Business	----

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.