New twist in Pem­bury farce

Lifestyle group CEO slaps com­pany chair with a R44m law­suit af­ter a se­cret record­ing of their con­ver­sa­tion airs on

Financial Mail - - AT HOME & ABROAD - Rob Rose Carte Blanche

ý The circus that is Pem­bury Lifestyle Group (PLG) took an­other far­ci­cal turn last week when founder and CEO An­drew Mclach­lan filed a R44m defama­tion claim against its chair, Martin Nel, who promptly quit.

Pem­bury, which owns 11 schools and a num­ber of re­tire­ment homes, has be­come an em­blem of the JSE’S re­luc­tance to pro­tect in­vestors by crack­ing down on er­rant be­hav­iour.

The JSE fi­nally sus­pended Pem­bury from trad­ing last week — but only af­ter it broke nu­mer­ous dead­lines to file its ac­counts for the year to De­cem­ber. But it means that 1,800 in­vestors, who ploughed R200m into the com­pany when it listed in 2018, are un­able to sell their shares. With the board now in chaos and di­rec­tors re­sign­ing al­most ev­ery week, it would seem their odds of re­cov­er­ing most of that money seem dim.

Nel was ap­pointed only last Oc­to­ber to fix the com­pany af­ter a se­ries of gover­nance dis­as­ters, a stream of res­ig­na­tions (in­clud­ing its au­di­tors) and al­le­ga­tions that Pem­bury was run­ning un­reg­is­tered schools and sell­ing life rights to the

It seems the pur­pose of the law­suit may be sim­ply to in­tim­i­date Nel

gramme aired, the share price was also at 8c. And less than two months be­fore, it was lower, at 5c.

Mclach­lan this week told the FM his lawyers know what they’re do­ing. “The case is: what was the in­ten­tion of the record­ing and the mo­tives of Nel? The dis­sem­i­nat­ing of the record­ing to var­i­ous in­di­vid­u­als with­out knowl­edge or per­mis­sion [of] my­self is where a ma­jor law­suit is oc­cur­ring,” he says.

He said he would also sue Carte Blanche and Pem­bury direc­tor Bheki Sibiya, who rep­re­sents the com­pany’s 15% share­holder, the

Black Man­age­ment Fo­rum in­vest­ment com­pany.

Last week, the JSE told the

FM it would in­ves­ti­gate the claims of share manipulati­on im­plied in the record­ing. This week, how­ever, Mclach­lan told the FM: “The JSE and Ar­bor Cap­i­tal con­firmed no share manipulati­on took place in Pem­bury Lifestyle Group trad­ing.” (Ar­bor Cap­i­tal used to be Pem­bury’s spon­sor un­til March 3, when it re­signed with im­me­di­ate ef­fect.)

How­ever, the JSE’S Shaun

Davies says Mclach­lan’s claim isn’t true. “We have not yet reached any con­clu­sions in our re­view of trad­ing in Pem­bury shares as to whether we need to re­fer any trad­ing ac­tiv­ity to the FSCA [the Fi­nan­cial Sec­tor Con­duct Author­ity] for fur­ther in­ves­ti­ga­tion, and we have cer­tainly not found that no share price manipulati­on has taken place.”

None­the­less, it seems Nel has had enough. On Wed­nes­day, he re­signed at Pem­bury’s board meet­ing af­ter he was un­able to table a mo­tion for Mclach­lan’s sus­pen­sion to be dis­cussed.

“They wouldn’t let me table that. So I said look, I can’t take this any more, and I re­signed. But I did ask them to minute the fact that I’m will­ing to work with the Hawks or who­ever will bring charges so jus­tice is done,” he says.

The real is­sue is that they took R200m of old peo­ple’s money. They don’t care who they tram­ple on

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