419 13.07.2014 CEO of digital media Eddie Mbalo, speak during an interview at Woodmead office park. Picture: Itumeleng English

ALLEGATIONS that Multichoice were deviously trying to destroy the only other pay-TV company in the country, On Digital Media (ODM), emerged during a shareholder court action.

A case was brought before the South Gauteng High Court in Joburg by shareholder Atchuthanandan Nadaraja Moodley against 14 respondents, including ODM, to try to stop a business-rescue process.

ODM started its operations in 2010. Previously known as TopTV, the brand changed its name to StarSat last year.

Moodley’s case was dismissed with costs last week. He claimed that the business rescue plan was illegal and flawed.

Two years after launching, ODM faced financial difficulty and in October 2012 the board resolved to commence business-rescue proceedings.

Moodley, who held a 0.7 percent voting right, was the only shareholder who voted against this. StarTimes Communications Technology Company came in as a strategic shareholder, investing capital and skills into the business.

Business-rescue practitioner Petrus Francois van den Steen said in an affidavit that he questioned the motive behind Moodley’s application, because if the business was liquidated he would have no financial benefit. Van den Steen said all Moodley aimed to do was derail the process “to ensure the business of the first respondent is permanently removed from the market”.


Moodley argued that upon implementation of the rescue plan, his shareholding and economic interest would be less than to which he might have been entitled, from 0.7 to 0.123 percent.

Van den Steen said he believed Moodley’s litigation was being funded by a rival.


According to the affidavit, a few days before the meeting which decided the business-rescue route for the company, a proposal was submitted by MSG Afrika Media and Falk Trading. In the proposal they indicated they had received enterprise development funding for the sum of R500 million from Multichoice. Moodley ceded his claim in ODM to MSG Afrika Media.

“Given the lack of any commercial rationale for the applicant to oppose the implementation of the ODM rescue plan, and the obvious interest that Multichoice, as the sole player in the pay-TV market, has in ensuring that the rescue of the business of the first respondent should fail, it is my belief that Multichoice or a competitor of the first respondent is behind this application.”


Multichoice said as a part of its enterprise-development initiative, they supported the Dynamic TV Consortium in May last year, who put in a bid as part of the business rescue of ODM.

The company said the bid was rejected and their enterprise-development support ended there.

ODM chief executive Eddie Mbalo said they were relieved the case was over so they could go ahead with future plans for the company.

“Most of the conditions for business rescue have been met. This was the only obstacle, so hopefully if nothing happens in the next few weeks, the company will be able to go forward,” Mbalo said.