Cape Town - The case in which SA Clothing and Textile Workers’ Union (Sactwu) sued Independent Media Consortium (IMC), formerly the Sekunjalo Independent Media Consortium (SIM), has been adjourned to Monday.
The adjournment follows the emergence of new email evidence that the union’s lawyers want to analyse before continuing with the matter.
Sactwu sued IMC for R300 million, which it claims is the capital plus interest on a R150 million investment agreement they say was a loan.
The matter ended on Wednesday with Independent Media chief executive Takudzwa Hove being cross-examined by the Sactwu advocate Leon Kuschke SC about whether he had pressured the union’s general secretary André Kriel into signing the “loan” agreement.
Yesterday, proceedings opened with Kuschke telling the court they had received emails from IMC attorneys on matters that had not emerged during discovery.
Kushke said he and IMC advocate Eduard Fagan met and discussed the matter before the judge appeared in court and had between them agreed it would be best to adjourn to give the Sactwu side time to examine specific documents more closely.
“There’s a lot of documents that need to be analysed and we are going to ask the court for an indulgence to stand the matter down.”
Kuschke said the new evidence had been triggered by Hove’s evidence on Wednesday and concerned the issue of when exactly the contentious subordination agreement was signed.
Acting Judge Michelle O’Sullivan, who is presiding over the matter, said she would have preferred not to stand the matter over for too long and would have to consult with the Western Cape High Court division’s Acting Judge President.
She asked the counsel to discuss and consider whether they would be prepared to make their final arguments during the upcoming two-week court recess.
“That would be my preference so that I can write the judgment while it is still fresh.”
A subordination agreement is defined as a legal document that establishes one debt as ranking behind another in priority for collecting repayment from a debtor.
This agreement said the union’s R150m investment would be repaid only when the media group’s assets exceeded its liabilities. The investment was later swopped out for shares in Sagarmatha Technologies in 2017, which was proposed for listing on the JSE.
The matter goes back to 2013, when Sekunjalo Investment Holdings (SIH) decided to buy the Independent Media publishing group from its then-Irish owners.
SIH brought on board partners who were looking to increase their existing footprint in the media space, including Sactwu. Through its investment arm, handled by Kriel, the union decided to invest R150 million into Independent News Media South Africa.
In that way they became part of the special purpose vehicle, created for the occasion, which made the successful bid for the company.
When the final agreement was signed, Sactwu requested to change the equity into a loan of R150 million, having suffered a severe setback as a result of a failed investment elsewhere.