PSG checks out, Grindrod steps in.

JOHANNESBURG - Late on Tuesday, just before the public holiday, Blue Financial Services announced it is changing its designated adviser from PSG to Grindrod Bank. PSG claims a "conflict of interest". What's going on?

Morné Reinders, group corporate affairs executive, says PSG approached Blue with its concerns. The concerns arise out of PSG's recent offer to buy out minority shareholders of small bank Capitec. "They aren't comfortable sitting aside the two fires", says Reinders.

Asked whether PSG's actual concern was over being associated with the troubled financial services firm in case it goes bankrupt, Reinders responds "why would Grindrod get involved if they were worried about that?"

Reinders explains the relationship with Grindrod Bank started back in the days of Blue's listing. In fact, the lead adviser at PSG is moving over to Grindrod. Reinders comments that Blue is essentially dealing with the same person but under a different banner.

In terms of an operational update, Reinders says that Blue is still paying salaries. This bodes a little better after Blue's torrid interim results.

On a lighter note, the business cards CEO Dave van Niekerk hands out are bigger than Reinders and Chief Financial Officer Shaun Strydom's. No ego at play here though. Reinders says Van Niekerk has old stock and doesn't go through them as quickly as the other execs.

Write to Chris Blaine: chris@moneyweb.co.za

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