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Rea Vaya Business Rescue: Taxi Operators Face Uncertainty After Trading Vehicles for Shares

Published December 28, 2023
7 months ago

In a turn of events that underscores the volatility of the public transport sector in Johannesburg, several taxi operators are currently facing hardship after having exchanged their means of livelihood for shares in the company running the city's Bus Rapid Transit (BRT) system, Rea Vaya. These operators relinquished their taxis and licenses with the hope of securing a stable future in the transport industry, but now find themselves in a dire situation as PioTrans, the operator of Rea Vaya, has been pushed to the brink of collapse.

A business rescue procedure was instituted following a successful application by PioTrans creditors who complained of outstanding payments for services. The move, which was initiated last week, is seen as a necessary step to salvage the company, which is beset with allegations of fraud and mismanagement.

Mahier Tayob, the appointed business rescue practitioner, has highlighted fraud, maladministration, and misuse of company assets as pressing issues within the administrative arm of PioTrans. These internal ills have been cited as significant contributors to the company's financial instability and have led to the dissolution of the Rea Vaya board in the wake of the business rescue.

The plight of the taxi operators involved is exacerbated by the fact that they own a 66% stake in PioTrans, an investment made when they handed over their taxis as part of the transition to the BRT system. This was meant to be a cooperative effort to modernize and streamline Johannesburg's public transport, but it has instead left 309 family-owned taxi businesses in jeopardy.

Kenny Kunene, the Member of the Mayoral Committee (MMC) for Transport in Johannesburg, underscored that the priority is now to offer assistance to the affected families. He mentioned that business rescue was the absolute last resort, revealing the gravity of the situation and the urgent need for a workable solution to protect both the stability of the public transport system and the financial well-being of the former taxi owners.

As the business rescue proceedings get underway, the future for these stakeholders remains uncertain. The original vision of a harmonious integration of taxi services into the BRT system now seems to be a distant reality as the city grapples with the implications of mismanagement and the aftermath of strained relations between PioTrans and its creditors. The coming weeks are set to be a crucial period for all involved, and it is hoped that the intervention will pave the way for a recovery of the fortunes not only of PioTrans but also of those whose lives are so deeply entwined with its success or failure.

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