In the last issue of Castings SA – February 2025 https://online.fliphtml5.com/fcuca/qaum/#p=18 – we reported that Elmacast Foundry, based in Nuffield, Springs, Gauteng, and its related company – Emidostax – had entered business rescue, unable to pay debts when they become due. The company is a producer of ferrous castings and it can trace its roots back to 1956. Components that were being manufactured by Elmacast range from pump casings, brake drums, bearing housings and gear housings.

However, on 25 March 2025 a notice was sent out to creditors and affected persons by the business rescue practitioners that they intended to convert business rescue proceedings to liquidation proceedings in terms of Chapter 6, Section 132(2) of the Companies Act no 71 of 2008 as amended.

“As the Business Rescue Practitioner appointed in this matter, I have a duty to, essentially, save the company and preserve its employment opportunities whilst devising a plan to restore the liquidity and solvency of the company on a sustainable basis,” said Thomas H Samons, a Senior Business Rescue Practitioner at Restructuring SA Group.

A major investment in 2018 was made by the new owners to convert the foundry into a grinding media supplier to the mining industry. The owners at the time were convinced there was a future in grinding media, and this initially entailed spending R134 million to do upgrades and expansions to the foundry. Various barriers to entry into the grinding media business led to the new owners deciding to exit the grinding media industry in 2021 and revert back to being a foundry

“I am of the opinion that the company can no longer be rescued and that liquidation proceedings in terms of Section 132 (2) as stated herein are the only option. There is no longer any reasonable prospect of the company being rescued.”

“The BRP hereby gives notice of the conversion of business rescue proceedings to liquidation proceedings. All affected persons are advised to exercise their rights in accordance with this notice. We shall keep creditors and affected persons informed of any material changes in this matter.”

For many years Elmacast was part of the Actom Group, before the new owners got involved.

A major investment in 2018 was made by the new owners to convert the foundry into a grinding media supplier to the mining industry. The owners at the time were convinced there was a future in grinding media, and this initially entailed spending R134 million to do upgrades and expansions to the foundry.

The project entailed the installation of four new induction furnaces, an automated continuous caster, and a fully integrated double line heat treatment plant. Further developments in the foundry included upgrades to the existing two 6-ton induction furnaces, an overhaul of all cranes, the installation of a shot blasting machine, a ball-breaking machine, a shell coating plant, and a thermal sand reclamation plant. With the initial goal that the foundry’s capacity would increase to produce more than 2 500 tons of grinding media comprising high chrome balls a month.

However, what the new owners could not foresee at the time, were the various barriers to entry into the grinding media business and that the timeframe to validate your product, to get it approved and accepted takes an extended period, exasperated by the fact that the market of the product – chrome cast grinding balls in sizes from 40mm to 110mm with Chrome (Cr) contents of up to 28% – is extremely competitive and has many established manufacturers and suppliers, it was reported at the time.

Additionally, the influx of products from China, like other products in South Africa, had a major influence on the local industry. In 2021 the new owners decided to exit the grinding media industry and revert back to being a foundry.

More recently the company was connected to a company known as Tau Iron Works which also has connections to the Eclipse East Plant that was in the Get Metals Group before being sold. As a spokesperson for the Get Metals Group said: “We have concluded a deal with a player in the industry. It was a good offer so we proceeded.”