JOHANNESBURG, Feb. 18 (Xinhua) -- African Global Group, which has been accused of involvement in corruption in South Africa, on Monday announced voluntary liquidation following notification that its bank accounts will be closed.
"We received formal notification from our financial institution of the decision to distance itself from the Group and as a result the closure of all the entities' bank accounts on or before Feb. 28," African Global chairperson John Gumede said.
"To avert a situation whereby the Group would not be able to further operate as of March 1, African Global board applied with various financial institutions, locally and internationally for a trading account," he said.
According to testimony in the so-called state capture commission, the company is accused of bribing government officials to get tenders.
Gumede said negative media coverage about his firm made financial institutions think it poses a "reputational risk."
"The decisions made by the financial institutions are not based on the African Global Group's liquidity status, financial stability and operational performance or growth forecasts," he said. "On the contrary, the Group is both factually and commercially solvent."
"Tragically, the Group will be unable to trade without a bank account," Gumede said.
African Global group said the liquidation will result in job losses and other consequences.
They company now employs 4,500 South Africans and has 108 interns who are getting stipends.
"The devastating ripple effect on suppliers and contractors is unparalleled as the group has in excess of 3,100 suppliers, many of whom are small businesses dependent on the work received from the Group," Gumede said.
