Pretoria - Basil Read has dismissed as “without merit” claims about the listed construction group by the Black Business Council in the Built Environment (BBCBE).
Andiswa Ndoni, executive officer for corporate affairs and governance at Basil Read, said on Monday that, contrary to the claims made by BBCBE secretary-general Gregory Mofokeng, the group had responded to a letter from the BBCBE on February 8.
Mofokeng said Basil Read remained “unco-operative and recalcitrant”, claiming the BBCBE had written letters to Basil Read chief executive Neville Nicolau, but he had not even bothered to acknowledge receipt.
Transaction
“Basil Read must know that we will oppose any transaction that will not meet our demands. We urge them to come to the negotiation table now before seeking shareholder approval and announcing their transaction to the market.
“If they don’t, they will be compelled by circumstances to review the transaction, and this will be very uncomfortable for the executives involved, including Mr Nicolau,” he said.
The comments by Mofokeng about Basil Read on Friday formed part of an attack by the BBCBE on planned and pending transformation transactions in the construction sector flowing from the settlement agreement between government and seven listed construction companies.
It appeared the BBCBE was attempting to take control of the voluntary rebuilding programme (VRP) process and seeking to be both a player for its members and the referee on planned and pending transactions.
Read also: Black council wants transformation
Mofokeng said the BBCBE wanted to realise permanent radical economic transformation using the VRP and “must define and be co-implementers of our own transformation journey”.
The agreement with government settled outstanding and pending civil damages claims by state entities against the seven listed companies following their payment of fines to the Competition Commission for collusion and bid-rigging during the commission’s construction fast-track process.
In terms of the agreement with government, the companies agreed to pay an additional R1.5 billion over 12 years into a socio-economic development fund and embark on transformation initiatives.
Each company has two options in terms of the transformation model: to sell more than 40 percent of its shareholding to black South Africans or mentor two to three black-owned emerging companies, which must reach a combined turnover of at least 25 percent of the listed company’s turnover within seven years.
Equity option
Ndoni said the letter that responded to the BBCBE’s letter referred the BBCBE to Basil Read’s stock exchange news service announcement.
He said it had also advised the BBCBE that Basil Read had decided to pursue an equity option, discussions related to which were ongoing, and a meeting with the BBCBE “would be premature at this stage”.
“With the government of the Republic of South Africa as our contracting party in the settlement agreement, we have duly notified the government of our decision to pursue the equity option as provided for in the agreement, and we are working towards the time lines and processes as provided for in the agreement.”