Luxe quietly winds up jewellers

• Individuals linked with Aurora and Pamodzi now at the company

Luxe, a jewellery company that has Arthur Kaplan and NWJ as subsidiaries and which is suspended from trade on the JSE, had the companies placed in liquidation in March — and failed to tell the market about it.

And it has come to light that Luxe shares the same business consultants as the failed Aurora mine and Velvet Sky airline.

Arthur Kaplan and NWJ owe creditors tens of millions of rand, and NWJ was placed in provisional liquidation in late December after a lender to which it owes R1.9m approached the North Gauteng High Court. Both Arthur Kaplan and NWJ were then placed in final liquidation in March, according to court papers Business Day has in its possession.

Luxe did not issue a news alert on the matter, as required by JSE listing rules, and while director Thulani Ngubane acknowledged the liquidations in a call, Luxe CEO Althea Grewar said it is a rumour she is investigating.

Meanwhile, individuals associated with Aurora and Pamodzi gold mines are now at the troubled Luxe.

The Pamodzi Grootvlei gold mine near Springs went from being a working mine to one that was not running, with equipment looted, 5,300 workers unpaid and serious environmental damage after it was taken over by Aurora Empowerment Systems from October 2009 to May 2011.

The individuals from Aurora working at Luxe include consultants Faizel Bhana and Bashir Moosa, attorney Ahmed Amod and former Aurora directors Tony Chammas and Ngubane.

Amod was a nonexecutive director of Luxe until the end of March and Chammas is a director, according to the company website. Moosa is the CFO of Luxe, according to a JSE news service announcement.

The group was accused at the time of pocketing millions from gold sales while none of its workers were paid and the mine’s assets were stripped.

Chammas, Bhana, Moosa, Amod and Ngubane were also linked to the failed Velvet Sky airline, which collapsed in 2012 and left creditors owed millions.

This is the third company the group has been involved in with a string of unpaid creditors and liquidation status.

It appears the individuals linked to Aurora became involved with Luxe after a 34.9% stake was bought in 2021 by Grewar. She had been chair at the now liquidated Nutritional Holdings and sold her stake in Luxe in December, though she denied doing so to Business Day despite the sale being recorded on the JSE news service.

She also denied the liquidations even after Business Day

provided court papers as evidence. “I am aware of the allegations of a liquidation but to date nothing has been registered.

“We are now investigating [this] information as this is reputational damage to the brand. Since last year August there has been attacks towards the brand known as Luxe.”

The Jewellery Council of SA, an industry body, recently wrote to members saying international companies could stop doing business with SA firms in the industry due to rumours about Luxe’s behaviour.

“The reputation and integrity of the jewellery industry are at stake, as international customers may stop doing business with SA to comply with Responsible Jewellery Council policies and procedures.

“Rumours within the international jewellery community have already begun, highlighting the urgency of resolving the situation promptly.”

RICHLINE

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WE MIGHT HAVE GOT BAD HISTORY ABOUT AURORA AND EVERYTHING. WE’VE DONE NOTHING WRONG AT NWJ

Thulani Ngubane Director, Luxe

The council wrote that it had received numerous enquiries from its members regarding Luxe’s nonpayment of suppliers.

Court documents filed in the liquidation application show that Luxe owed Liberty 2 Degrees, the Sandton City mall owner, more than R2.7m in unpaid rentals in October.

Richline, a jewellery manufacturing company belonging to the Berkshire Hathaway group owned by Warren Buffett — is NWJ’s main supplier. It is owed more than R11m by Luxe. Richline has sent numerous letters of demand to Bhana, but payment remains outstanding. Richline SA has been forced to lay off 44 employees due to nonpayment, MD Johan Bezuidenhout told Business Day. “Richline SA opened a criminal prosecution case against Luxe during February 2023,” he said.

Luxe has had three separate auditors in just over a year and now has no auditor and also lacks a company sponsor — both of which are required if it is to remain listed.

Its financials for the year ended February 2022 and for February 2023 have still not been provided to the JSE as required and it remains suspended. Multiple directors resigned in 2022.

Ngubane spoke to Business Day about NWJ, which he is now running. He said it is not fair to bring up the past and the Aurora involvement when asking about Luxe. He said when the group took over Pamodzi gold mine, it was already in liquidation. “We have been involved in companies that are three-legged dogs.” If he were given a functional gold mine today, we would expand it successfully, he said.

“We might have got bad history about Aurora and everything. We ’ ve done nothing wrong at NWJ. Instead, we try our level best with no funding.”

Speaking on behalf of NWJ, Ngubane said his role at Luxe is to save jobs and all 450 staff are paid every month. “Write something positive about us. None of NWJ staff has gone unpaid. They all have full-time jobs.”

He said NWJ is in talks with Richline about paying debt, and Richline needs its 50 NWJ stores and holds R8m worth of its diamonds.

Richline confirmed it is legally in possession of semiprecious and precious stones from NWJ but said it has not been asked to return them and it is still owed money.

Asked why Luxe had not told the market NWJ had been in provisional liquidation since December, Ngubane said there is no time frame required and it does not need to call a press conference to say the company was in liquidation.

He said that despite the Jewellery Council letter warning suppliers, many are “queuing” to do business as they are now paid cash up front.

Andre Visser, the director for issuer regulation at the JSE, was asked by Business Day if it is doing anything about Luxe not informing the market about the matter.

“Luxe has an obligation in terms of the JSE listings requirements to publish on Sens any price-sensitive information without delay. The JSE is engaging with the company on this matter,” he said.

Business consultant Bhana did not respond to an email request for comment.