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Durban - “What has happened to the money?” This is the question shareholders of Edge to Edge Global Investment Pty Ltd want a liquidator to probe because, they say, it is clear the company has very few assets - but a lot of liabilities.
Jennifer Etchells, a chartered accountant who worked for the company and who is also a shareholder, says in her affidavit in support of the court application that the company has only ever sold about 15 nutrition packs - consisting of porridge, nutritional supplements and water purifying drops - and generated no real trade income.
She said it would seem the company was insolvent and the only source of future revenue would be from further loans or investments.
She estimates debts of about R20 million - excluding any claims from shareholders - and says even though she left the company in March she is being “hounded” by Sars officials for money owing.
With regards to lifestyle, Etchells has attached an invoice from a wedding organiser reflecting that the company paid R1.4m for a wedding for director John Ellis’s daughter last year.
“This excluded the cost of the photographer, liquor, and wedding dresses which were made in London, plus various flights with family members to have the bridesmaids’ and wedding dresses fitted in London. It seems the cost of food was also not included in the invoice.
“Ellis stated to me that the wedding had cost in excess of R2.4m. He even caused to be built a whole new toilet and bathroom facility in the garden of his property in Marriott Road and installed toilets, as his daughter did not want her guests using porta loos and the toilets in the house were not enough for the number of guests invited,” she said.
Shareholder Tony Pinfold says in his affidavit that the directors enjoyed an “extraordinary high and expensive standard of living”, taking frequent trips overseas.
While Ellis lives in a house in Gladys Mazibuko (Marriott) Road, bought for R8.9m, it has a R6m bond over it and is registered in the name of the Ellis Family Trust, which also holds two sectional title units with large bonds. There are recent judgments against these properties.
There is nothing registered in Ellis’s or Louw’s name, neither personally, nor in a trust with links to Louw.
According to documents before the court all three former employees are suing for unpaid salaries - Hendrik Stassen for R1.4m, Etchells for almost R1m and Leon du Plessis, for R77 000. Etchells is also suing for a R100 000 loan she gave the company.
According to the court papers, the company’s website has been suspended, its landlord has obtained judgment for non-payment of rent and its moveable assets have been attached.