Potential buyers of the former Bop Recording Studios' sound equipment - said to be valued at R15-million - are furious about a government decision to sell it to a scrap dealer for R900 000.

And despite the London-based merchant's bargain-basement deal at the expense of the South African taxpayer, he is struggling to raise the money.

The saga has its roots in the days of apartheid, when high-quality studios in Mafikeng were built by the former Bophuthatswana homeland authorities. The studios were put up by the homeland's Sefalana Employees' Benefits Organisation, while the Bop Broadcasting Corporation installed the recording equipment.

Following the incorporation of Bophuthatswana into South Africa in 1993, the South African Broadcasting Corporation took over the studios. However, after numerous complaints about the exorbitant rental for the building, the assets were handed over to the Public Investment Commissioners (PIC) to run.

According to a source who worked at the studios until 2001, the top-quality recording equipment was valued at R15 million and put up for sale by tender in 2000, and several people, including overseas buyers, made proposals to purchase it.

"About six weeks ago some bidders were told that the sale had been concluded," said the source, who did not wish to be named.

The bidders were told that the equipment had been sold off as scrap to a British second-hand dealer.

"I really cannot understand why they had to sell it off as scrap. As far as I know more than 85 percent of the equipment was still working."

To complicate matters, the "broke" scrap dealer is apparently struggling to raise the money.

The are also concerns that the disposal of the equipment was not conducted in accordance with standard government procedure.

"Something is not kosher in this whole deal. What makes it even worse is the fact that decided to sell to a foreigner. That is in no way going to benefit our people," the source said.

These developments have sparked outrage among potential investors, one of whom had tried to buy the studio and equipment for R40-million. Music investor Eivand Bjornstad said his Norwegian company, Utopia, had also tried to buy the property, but, despite having offered the highest bid, the tender was never acknowledged.

"I have been in contact with the PIC since 1999 making an offer to buy the whole property. Our last offer made in April this year was for R40-million," Bjornstad said.

He said he was shocked to hear last month that the equipment had been sold to another person for far less than his offer. "I wanted to operate the studios and utilise the assets for musicians and songwriters in South Africa and internationally."

Schalk van Rensburg, a local sound engineer, said even though his company had presented the PIC with proposals to save the facility, the PIC notified him in April that it had decided to sell the equipment and lease the place to another government department.

"This facility was built to give South Africa a world-class facility to promote local and international talent. We have been trying everything to preserve this facility as a recording facility for our country ... we have tried to get the department of arts and culture to get involved and to intervene," Van Rensburg said.

Brian Molefe, the chief executive of the PIC, said it had decided to dispose of the equipment after the studio had not been used for several years.

"The other problem was that the key components of the equipment were being stolen. People should remember that that equipment was bought by the Bop Broadcasting Corporation 15 years ago. That kind of technology was old, and we were also losing the key components," he said.

Commenting on the allegations that the PIC sold the equipment to a foreign scrap-dealer for a pittance, Molefe said: "I cannot confirm or deny that.

"All that I know is that there are discussions going on around that and that we are at a delicate stage of the negotiations. That is our equipment and surely we can decide what to do with it," he said.

Confirming that Bjornstad had personally raised issues with him, Molefe said people who complained about being overlooked regarding the sale of the equipment had no right to dictate to the PIC on what to do.

"The PIC is considering alternative uses for the studio. Nobody has used that studio for years and we have been paying for security and maintenance without any returns," Molefe said.

The facility has been described as one of the best recording studios in the world. It was last used in 2001.