Feuding partner lays fraud charges against WP Rugby

2017-09-19 13:00
WP Rugby logo (File)

Cape Town – Aerios, the company at the centre of a multimillion-rand advertising rights dispute with WP Rugby, say they have laid fraud-related charges against its board of directors over alleged non-presentation of the liquidated professional arm’s “statement of affairs”.

Included are two directors of Remgro, the investment company which had a 24.9 percent stake-holding in the WP business wing until it announced its withdrawal of financial support in early August.

They say the charge affects all WP directors active in the year leading up to the liquidation late last year, whether they resigned in the interim or not.

But Remgro CEO Jannie Durand said on Tuesday that Aerios’s allegations were “unfounded”.

A Section 417 inquiry into the bankruptcy is ongoing, though recently postponed to November as WP Rugby chief executive Paul Zacks - as reported by Sport24 late last week - has applied to the Cape High Court to set aside subpoenas issued as part of the probe.

Aerios have a damages claim of more than R270 million with WP Rugby over alleged advertising rights violations.

They maintain that the liquidation (a new entity owned by the Union and backed by Remgro at the time effectively bought the liquidated company) was a “fraudulent plot” to free WP Rugby of contractual obligations to them.

In a statement on Monday, Aerios said: “WP Rugby directors and the CEO (Zacks) have not provided the liquidated company’s “statement of affairs” to the Master of the High Court, as required by the Companies Act of 1973. This constitutes a criminal offence.

“Aerios has pressed charges with the South African police and understand that the Hawks will investigate further.

“On December 20, judgement was handed down by Mr Justice Binns-Ward incorporating a final liquidation order against Western Province (Pty) Ltd. Those who were directors and officers of the company within the 12 months preceding the liquidation of the company are legally obliged to lodge a ‘statement of affairs’ with the Master of the High Court within 14 days after the winding up of the company.

“The ‘statement of affairs’ is provided by the directors and officers of the company showing the assets of the company, stating cash balance on hand in the bank, its debts and liabilities, the names of all creditors, including all relevant information, secured and unsecured debt whether owed by the company or its officers, including values and dates.”

Aerios say their lawyers asked the legal representatives of the liquidators (Mazars Recovery and Restructuring, under managing director Chris van Zyl - Sport24) to provide a copy of the statement of affairs of WP Rugby.

“The attorneys of the liquidators confirmed that no ‘statement of affairs’ has been lodged with the Master, despite 10 months having elapsed since the final liquidation order was granted and the attorneys of the liquidators have apparently reminded the attorneys of the WP Rugby directors and officers to comply with their statutory obligations in this regard.

“According to the Act, any person who fails to comply with the obligation to deliver the statement of affairs shall be guilty of an offence and liable to imprisonment for a period not exceeding six months or to a fine or to both imprisonment and a fine.”

On Remgro’s involvement, the Aerios media release added: “Remgro Sports Investments (Pty) Ltd (RSI) was a shareholder of WP Rugby and had directors serving on the board.

“They are accordingly also directly implicated in the police investigation. It is inconceivable that Johann Rupert, the driving force behind RSI, did not bear personal knowledge of the dealings of the WP Rugby board.”

Aerios chief executive Costas Constantinou said: “There is no way that Rupert did not know what the plan was for his beloved Western Province Rugby long before liquidation and what the Remgro plan would be after liquidation.

“(He) continues to allow Remgro and First Rand director Francois Knoetze and Remgro group financial director Neville Williams to behave like this.

“Remgro is a JSE-listed company with significant investors like pension funds and collective investment schemes. Surely this practice needs to be investigated by the Remgro board shareholders.”

Remgro boss Durand, however, told Sport24 in a statement: “Throughout the liquidation process we have gone to great lengths to obtain professional advice in order to adhere to all relevant rules and regulations.

“Having (viewed) the latest statement and allegations from Aerios, we have been advised that these allegations are unfounded and the statement (from them) is misleading.

“It is disingenuous from (Constantinou) to try to involve Mr Rupert as he has on numerous occasions stated that he had nothing to do with the decision to liquidate WP Rugby.”  

*Sport24 has approached WP Rugby for comment.

Read more on:    wp rugby  |  rugby


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