Sekunjalo calls PIC move to liquidate SIM bizarre and ludicrous
Opinion / 13 November 2019, 06:00am / Sizwe Dlamini
CAPE TOWN – Sekunjalo Independent Media (SIM) on Tuesday received an application for its liquidation from the Public Investment Corporation (PIC).
Takudzwa Hove, the spokesperson for SIM, said the PIC’s application was frivolous as it appeared to have intentionally omitted certain factual and legal considerations relevant to the matter.
“If it had included these facts, it would have nullified the application,” said Hove. “By virtue of the PIC’s debt-for-shares swop into Sagarmatha Technologies Limited, the PIC no longer has any claim against SIM.”
Dr Iqbal Survé has been cited as a party to the proceedings, even though no relief is sought against him. “The PIC’s application is not only incompetent and mala fide (in bad faith) but malicious … And is designed as a further attempt to embarrass and undermine the Sekunjalo Group and Dr Survé,” Hove said.
SIM is a subsidiary within the Sekunjalo Group. Its subsidiary, Independent Media and News SA (INMSA), is fully operational and not a party to the liquidation application.
On October 16, Lindiwe Dlamini acting executive head of legal counsel, governance and compliance at the PIC, appeared before parliament’s portfolio committee where she made utterances to the effect that the PIC intended to liquidate Sekunjalo, falsely creating the impression that the PIC would liquidate the Sekunjalo Group instead of SIM.
Despite the Sekunjalo Group seeking clarity, the PIC has to date, failed to do so.
Hove said: “SIM has instructed its attorneys and will vigorously defend this matter.”
SIM, a special purpose vehicle, took up 55 percent of INMSA. The PIC took up a direct 25 percent stake. The remaining 20 percent was taken up by Interacom Investment Holdings, funded by the China Africa Development Fund.
The Sekunjalo Group has issued numerous statements stating how it has recapitalised the loss-making INMSA, yet the PIC’s head of legal still saw fit to tell Parliament that the PIC was considering liquidating Sekunjalo.
Senior executives within INMSA described this latest move by the PIC as preposterous, vexatious, laughable and without merit.
A number of questions are raised over this current course of action. One is whether the PIC’s move to liquidate SIM is part of its new strategy to recover its invested funds in all underperforming or failed investments, or has SIM been purposefully singled out? Has Africa’s largest asset manager considered alternative avenues to recoup its investments? Has the PIC considered the cost of job losses that would result if it were successful?
The PIC did not give comment at the time of going to press although, it did acknowledge receipt of questions from Business Report.
The recent sequence of events surrounding Sekunjalo-related companies appear to be signs of a co-ordinated attack on the media entity, and Sekunjalo as a whole. They are also timely in as much as Sekunjalo offices were raided just, as the deadline for the PIC Commission of Inquiry approaches its deadline. Strangely enough, shortly thereafter, the Commission gets an extension.
The sequence of events certainly raises some curiosity.
A source who has been closely following the matter said that this pointed to the powerful elite using state entities at their disposal to fight opponents, suggesting that this may also have the hidden hand of Minister Pravin Gordhan.
The source said there is a fierce fight to gain control over INMSA in a bid to stifle transformation within the media space.
This reporter, in conversation with a minister’s spokesperson, was sternly warned, “be careful what you report”. The matter of an orchestrated attack on Independent Media’s freedom is quite glaring and cannot be ignored.
The PIC is the largest asset manager in South Africa, and it recently announced that its assets under management for the financial year ending March 2019 had grown to R2.131 trillion.
The asset manager had R7.4 billion in impairments for the 2017/18 financial year.
The impairments included R4.3 billion raised against a R9.3 billion loan to the Lancaster Group – which was used to fund an empowerment stake in Steinhoff – and R374 million in VBS Mutual Bank.