Black day for business
CAPE TOWN - In a strongly worded statement issued earlier this week, the Black Business Council (BBC) condemned the overt propaganda war waged by several sectors of the media establishment against the proposed listing of Sagarmatha Technologies Limited. (Sagarmatha Technologies positions itself as a Multi-Sided-Platform that dealing in content, eCommerce and technology. It was due to list on the Johannesburg Stock Exchange in the Media and Entertainment sector on Friday 13th April 2018.)
According to the statement issued by the CEO, Kganki Matabane, the BBC is of the opinion that the “anti-transformative narrative” against Sagarmatha Technologies was designed to continue to exclude the majority of South Africans from owning a piece of the mainstream economy. A reality that now seems will continue with the JSE stopping Sagarmatha Technologies from listing. The company had easily exceeded the investment sum set down by the JSE as a pre-listing requirement. It had achieved ‘indicative commitments’ of a comfortable R4 billion.
“Sagarmatha Technologies not listing on the JSE is a blow for all the people of South Africa,” stated a deeply disappointed George Sebulela, Secretary General of the Black Business Council, (BBC). “There is a deep and urgent need for the media and ICT sectors to be transformed in South Africa. Involving our members in the ownership of Sagarmatha Technologies and what it can bring to the continent, was (and still is), an exciting prospect. There is no doubt that digital is the catalyst for an economic transfer to occur and the BBC is saddened by the fact that this has once again been pushed out.” The BBC had pledged to invest R240 million into six million shares of Sagarmatha Technologies stock, giving their membership a foothold into a sector of the economy that is expected to generate several billions in GDP by 2030.
Several of the Trade Unions, whose combined membership base amounts to more than three million, would also have benefitted from their shareholder participation in the listing. They too have expressed their frustration with the decision by the bourse to halt the entry of Sagarmatha Technologies, feeling it shuts down the opportunity for their shareholders to own a share of voice in the greater 4ICT economy.
“We are under no illusion that economic transformation is not going to be a painful process, with artificial obstacles that are put in front of black entrepreneurs but, we shall make sure that our listing will take place. We expected these roadblocks anyway, and we are certain more will come, but we will remove them with our determination to achieve the transformation of the South African economy, together with our peers in the industry” stated Stephen Nthite, CEO of Kopano Ke Matla Investments (Pty) Limited, when approached for comment. The investments company is owned by the Kopano Ke Matla Trust, whose beneficiary is COASTU. They are another investment party that would have derived long-term benefits from the deal, for their members.
The JSE, in a notification sent out on SENS late Wednesday, cited that at the time of the issuing of the pre-listing-statement (PLS), Sagarmatha Technologies was non-compliant with Section 33 of the Companies Act 71, of 2018 paragraph 4.6. which requires the submission of financial statements to the Companies and Intellectual Property Commission (CIPC). On 11th April, Sagarmatha Technologies received written confirmation from CIPC indicating that it was compliant and had provided the required financial statement. Nevertheless, this technicality was enough for the JSE to ask Sagarmatha Technologies to apply afresh – if it wishes to re-list the organisation.
Mr Mntuwekhaya Cishe, Secretary General of the Black Business Chamber also expressed his surprise at the turn of events, saying: “There are hundreds of companies listed on the JSE and probably thousands of companies in South Africa that do not strictly and timeously, on the hour, submit their financial statements. They are not censured in this way.” Mr Cishe remarked that Steinhoff, currently in breach of numerous regulations of the Companies Act , continued to trade – on the JSE. “Are there two sets of rules – one for black companies and another for white owned companies?” he asked. Mr Cishe said his organisation is now intending to approach the Equality Court and the Human Rights Commission around the seeming discrimination against Sagarmatha Technologies.
In terms of transformation at the JSE? Sagarmatha Technologies did not want to be drawn on the question of whether the JSE was transformed or not. However, in an interview Nicky Newton-King, CEO of the JSE gave to the Daily Maverick in October 2017, she said: “We should be spending [more] time on those policy interventions that build growth in order to accelerate transformation.”
- BUSINESS REPORT