Collapse of Post Office shows 'SPECTACULAR destruction of value' - former CEO

The South African Post Office (Sapo) has acknowledged that its 'Day Zero' is approaching, possibly as early as next month in October.

That's when the state entity's cash reserves will be depleted and its business rescue practitioners (BRPs) may need to consider liquidation.

Sapo was on the brink of being liquidated last year before it was ultimately placed under business rescue. 

To fulfill its business rescue plan and sustain its operations, it would need a R3.8 billion bailout from government.

John Perlman talks to former Sapo CEO Mark Barnes, who resigned three years into his tenure.

Following his departure, Barnes had presented a plan for a consortium to buy into the failing enterprise to save it.

He agrees that this latest turn of events has been a long time coming.

If you look at the 'spectacular' destruction of value over the past three years, the end was almost inevitable, Barnes remarks.

"I think it did start with wanting to take the bank out of it... Postbank, which had no right to do so, lent money to the ailing Post Office... which, when it was insolvent started selling properties which is of course illegal to do, and so on."

"The financial reconciliation between the operating losses since I left and the total decimation of value just doesn't reconcile, even if you take into account the fact that creditiors are only getting 12 cents in the rand... There are some missing billions there in my view."

"It's wrong that weve become used to this... and numb to these fantastically irreconcilable numbers."

Mark Barners, Former Sapo CEO

To hear more from Barnes, listen to the interview audio at the top of the article