www.moneyweb.co.za/in-depth/investigations/sharemax-rescue-vehicle-o n-the-brink-as-creditors-circle/
In case the article is moved behind Moneywebs paywall, it can also be viewed here www.ndcag.co.za/go/202506191, and for Nova Chair Connie Myburghs response to Moneywebs questions, here <www.ndcag.co.za/go/202506192> www.ndcag.co.za/go/202506192
Whilst, on the surface, it is correct that if Nova goes into liquidation, there is not enough money and insufficient assets, available to meet all of the companys liabilities including the 2.2 billion value of the yet to be repaid debentures, it is not the only source of possible debenture repayment
The article states that the CIPC investigation (into the 2010 shut-down of the PSPC – Property Syndication Promotion Companies – industry which included Sharemax and into Nova itself due to repeated failures to meet Companies Act obligations and the failure to repay all of the debentures by 22 January 2022) has ground to a halt
This is not the case. Yes, we still await the release of the CIPC Investigations Interim Report and have been for almost two years now. But there are actions underway to move forward
On 2 June, CIPC sent out a letter to all of the investigation participants who had already signed and submitted Non-Disclosure Agreements to CIPC (thats non-disclosure of the contents of the Interim Report) together with documentation for recipients comments on the reports contents. The letter opened with a statement to the effect that the recipients had already received the report but not directly from the internal Investigation division of CIPC – probably from their legal area
That report had not been sent out by 2 June and still has not. It appears that, on the one hand, there is much bureaucracy involved which keeps tripping up the release and on the other, we suspect, there are entities, organs of state, and individuals perhaps, who are also intervening because they are going to be seriously embarrassed at what the Final Report reveals whether because of their part in the process that led to the shut-down, or their failure to act when addressed by the activists, some of the PSPC company directors and whoever, on the allegations of wrongdoing
The sending of the letters on 2 June indicates that CIPC Investigation division is ready to proceed and process investigation participants comments as preparation for the CIPC Inquisition (to take place thirty days after the release of the Interim Report) on the findings of the investigation which will lead to the formulation of the Final Report, which, we understand, will be made public
Given the expectation that the findings will expose who and which entities engineered and benefited from the deliberate shut-down (and as has been alleged, capture of the PSPC companies assets) we are of the opinion that all of the PSPC investors (or their successors) can look to the Investigations outcomes as their best hope of receiving their money back
But, it will not necessarily happen quickly. Once the Final Report has revealed the details of the illegalities and irregularities that were perpetrated back in 2010, decisions will have to be made on what to do about the revelations. Once those decisions have been made and implemented, will there be legal action against those persons and bodies found to be responsible and accountable? Will those same persons and bodies institute legal actions of their own to contest the findings and/or to defend their actions? How long will all of that take?
Note also the input from Debenture Trustee J-P Tromp. He is still speaking publicly and in negative terms about Nova which indicates that he is still pursuing actions against the company. We await further news in this regard
Regarding Nova Chair Connie Myburghs response to the liquidation application by Bright Light, wed say that of course he would respond as he did. Typical Myburgh tactics in our opinion. He states that Bright Light is a seemingly unregistered electricity provider. According to CIPC company registrations, Bright Light is registered with CIPC as a Venture Capital Company with enterprise number K201649138. Does that not legitimise them? Anyway, why label them negatively now? Did they not have doubts right from the start of the solar installation project for the relevant properties? If so, why trade with them in the first place (reckless trading)? Or, are those doubts now expressed, just a smokescreen?
Likewise, with Beneficio and the 31 million loan. When they could not repay and the pressure was on, they complained that the interest rate was usury. But they entered into the deal nonetheless! Were the directors wearing blindfolds when they signed the contract? What was the purpose of the loan anyway? Something not benefiting the business per sé and not in the interests of the Debenture Holders?
According to the court record (North Gauteng High Court, Pretoria) for Benefico vs Tarentaal Centre in the Saffli archive – www.saflii.org/za/cases/ZAGPPHC/2023/324.html – Nova stated that [64.4] The money was borrowed as a result of a business decision by the defendants and the NOVA Group to repay debenture holders and to avoid reputational damage it was a business decision which made sense to the defendants and the NOVA Group. It made sense? Whos kidding who here? Was this the true reason? Just another smokescreen? What on Earth would lead the Nova directors to think convince themselves? – that a debenture repayment of 31 million out of a total amount due of 2.2 billion would in any way contribute to avoiding reputational damage? Does that approach mean that they were not aware (and are still not?) of the huge scale of the reputational damage that already applied and continues to apply?
The downside of Novas tactics? They spend company money, what Myburgh publicly referred to, at one of the Debenture Trustee election meetings back in 2021, as our money, implying Debenture Holder money that could be used to repay, to defend their interpretations of the law or the legal opinions received (again, paid for with our money) and to attempt to escape the consequences of what has been alleged as occurrences of reckless trading. Deemed reckless trading which could lead to a CIPC Compliance Notice, in terms of the provisions of the Act, ordering them to cease trading which action in itself will probably lead to further legal action by the company (our money, again)
But the directors will continue promising repayment whilst stalling, fighting and spending our money on legal actions for as long as they can. Why? Because, we believe, Nova is a cash cow which they milk and have been milking ever since they acquired the Sharemax assets. That, we believe, was the hidden purpose behind the Sharemax Business Rescue (refer also Ryk van Niekerks content on the Harrison & White liquidation)
Mr Myburgh and co-directors of Nova Group: we invite you to respond and try to convince us otherwise. But, thats a hell of a mountain to climb and your chances of success are very slim!