Ahead of the Rebosis annual general meeting (AGM) on Tuesday, the real estate company’s chief executive Sisa Ngebulana threatened to interdict the chair of the Moti Group, Zunaid Moti, from being able to exercise voting rights at the meeting.
Correspondence between Moti and Ngebulana’s legal representatives earlier this month shows how both parties claim to hold voting rights at the Rebosis AGM.
The spat stems from Moti’s shares in Rebosis which were sold to Ngebulana’s family trust, Amatola Family Trust in August last year. The Trust, however, failed to make the R125 million payment towards the shares, prompting Moti to apply for the sequestration, claiming that the Trust was insolvent.
In a letter dated February 19, 2021, which was addressed to the Central Securities Depository (CSDP), the Trust’s legal representative threatened to interdict Moti should he not provide Ngebulana with a letter of representation that would enable the trust to vote at the Rebosis AGM.
The response from the CSDP was that Ngebulana’s assertion was wrong and ran contrary to the provisions of a written agreement of cession and pledge of shares.
At the time of publication, Ngebulana had not filed the interdict and declined to comment on the matter.
Ngebulana spokesperson, Camila Osborne told Moneyweb that Amatolo Trust views the dispute over voting rights and share ownership as yet another opportunistic attempt by Mr Moti to receive undue benefit.
“The Trust’s legal advisors have engaged the CSDP and transfer secretaries on the matter, as the Amatolo Trust remains the registered owner of these shares and is therefore entitled to vote on them,” Osborne said.
“The Trust remains open to an amicable resolution of the dispute, but considering the underhanded tactics that have permeated our dealings to date, this seems unlikely.”
In court papers, Ngebulana claims that when he signed a share purchase agreement with Moti, he did not have the approval of the two out four other trustees of Amatolo and as such “there is and has never been a resolution from the trustees of the Trust to authorise the purchase [Moti’s] shares in Rebosis.”
Shares for the taking
Ngebulana claims that because the share purchase agreement is null and void, Moti is free to tack back his shares.
By August last year, Moti was one of Rebosis’ largest shareholders with a 25,99% share in the company following increasing his stake in Rebosis in May. Ngebulana owns 31,26% of the company.
In response to Ngebulana’s affidavit, Moti has claimed that Ngebulana’s version of the facts is not only false, but far-fetched, improbable, and clearly untenable.
The opposing parties have failed to reach a settlement agreement prior to the AGM.
Moti’s office told Moneyweb that it had not received a positive response from Ngebulana regarding a possible meeting to settle the matter. Osborne, however, said Ngebulana’s office had not received an invitation from Moti to meet.
Shareholders at the Rebosis AGM on Tuesday are set to vote on 50 resolutions including reducing its contingent liabilities which include managing the company’s spiralling debt problem. It’s 2020 annual report shows that its current liabilities exceed the value of its current assets by R9.8 billion at a group level making it technically insolvent.
To reduce its debt, the company is pursuing three options including disposing of large commercial assets, considering delisting from the JSE and continuing with its disposal program of the sale of assets.
While Moti says he remains “cautiously optimistic” regarding the turnaround of the real estate company he says it can only be achieved with the implementation of a plan to “protect the interest of its shareholders and other stakeholders.”