HANDY HINTS ON SAVING ELECTRICITY – CHART INSIDE Kebble copycat killing?
State-owned IDC stands to lose R123 million
HUNDREDS of millions of rand are set to be flushed away in the murky dissolution of a company involved in the controversial Medupi power plant, and whose chief executive was recently found murdered in the veld in what investigators now suspect was a Brett Kebble-style “arranged” murder.
The Weekend Argus can reveal the state-owned Industrial Development Corporation (IDC) stands to lose up to R123 million it invested in Cosira, a structural steel company involved in the Medupi power plant, and which was provisionally liquidated last week.
Cosira is one of several subsidiaries of First Tech, all placed under provisional liquidation last week, leaving some 800 employees in the lurch.
The IDC is just one of a number of entities, which also include leading banks and investment houses like Nedbank, Investec and the Sanlam Group, which have been affected by the First Tech meltdown. It is believed that the total amount of exposure is in the region of R925m.
It was reported this week that Investec said their loan totalled R240m, but had been fully secured. Investec Asset Management, however, indicated they had invested thirdparty funds into the company, and these would be affected by any loss of value First Tech experienced.
Sanlam said policy holders would not be affected as their loan had been adequately provided for, while Nedbank echoed similar sentiments.
There had been desperate attempts to keep Cosira afloat, and it was just days after a business rescue application last month that the body of First Tech chief executive Jeff Wiggill was found next to his black Bentley in an open field in Soweto. Only his wallet and phone were missing.
Wiggill’s death blew the lid on the financial meltdown of the companies under his watch, as First Tech and many of its subsidiaries were also forced to file for business rescue.
In the application for business rescue, company founder Andy Bertilus wrote that “shareholders have during the last few months attempted to ease the company’s immediate cash-flow shortages by not only providing the company with immediate funding, but also by negotiating with various third parties, including the Industrial Development Corporation (IDC), in an attempt to secure additional funding”. The business rescue has failed, however, and liquidation proceedings have begun.
IDC spokesman Mandla Mpangase said yesterday: “The IDC has an exposure of R123m in Cosira. No other facilities were provided to the group. In terms of our legal agreement, funding was meant for servicing contracts that Cosira had. Since the company has been placed in provisional liquidation, IDC funding is at risk at this stage.”
He said it would be difficult to say what total losses would be until the liquidation proceedings had concluded.
Charging that the First Tech chief executive had been “solely responsible for the financial affairs of the group”, Bertilus wrote that “the tragic demise of Mr Wiggill has placed not only the company in a dire and invidious position, but also the group as a whole”.
“Due to Mr Wiggill’s untimely demise and the depressed economic climate… the group has incurred significant losses,” he wrote.
But questions have been raised about the killing, including that Wiggill may have orchestrated his own murder by paying a man R100 000 to kill him.
One of the men arrested for Wiggill’s murder, Thulani Cele, told the Protea Magistrate’s Court in his bail application this month that he was to be paid R100 000 to kill Wiggill.
Police investigators are probing the possibility that the money – and
the order – may have come from Wiggill himself.
If proven, it would be eerily similar to the infamous 2005 Kebble murder.
The man who shot Kebble, Mikey Schultz, admitted in court in 2010 that he and two underworld accomplices were contracted to kill Kebble for R2m – and they succeeded only after three bungled attempts.
Wiggill was found by the police early on June 20, with gunshot wounds to the head.
It is understood the father of five had been driving near Melrose Arch when he was apparently hijacked and taken to Soweto.
The killing of Wiggill mirrored Kebble’s own shooting in his car near Melrose Arch.
Kebble is said to have planned his own murder to appear as a botched hijacking, at a time when his massive group of mining companies was under extreme financial pressure.
Liquidators are now poised to begin unravelling the complex web of companies under the First Tech umbrella.
Cosira was acquired by First Tech in December.
Despite major contracts such as the Medupi plant in partnership with French giant Alstom, and the Kusile power station, both still being built, the company applied for business rescue on June 12 – a week before Wiggill’s murder.
WHALE OF A TIME: One of South Africa’s big wave surfers gets up very close and personal to this inquisitive young whale, which joined him and his fellow surfers riding the waves off Hermanus this week. See P3 for the full story and more pictures
RED BERETS: Kenny Kunene and members of the Economic Freedom Fighters make their way to the entrance gate of the University of Johannesburg where ANC supporters and guards denied them access.
BABY HEAVEN: Jenny Warwick, right, watches over her son William at the Baby Indaba at the Cape Town International Convention Centre. The expo runs until 5pm tomorrow. Entry is R60 for adults and R20 for children. There is free entry for under-sixes.