Fidentia’s last assets sold for a steal at R39m

Cape Town – The Sante Hotel and Spa complex, the last of troubled Fidentia’s assets, went for a steal at a combined R39m under auction on Thursday.

A buyer bought the Sante Hotel, conference centre and resort spa for R25.1m, while the Bayonne spa suites went to another buyer for R2.6m. Three villas on the property were sold to separate buyers for R4.6m, R4m and R2.7m.

The prices excluded VAT and an auction commission fee.

ClareMart CEO Jonathan Smiedt said that, with VAT and fees, the final price tag came to around R42m or 43m.

It was considered a December bargain since the package of properties was currently worth around R80m in terms of a municipal valuation. According to the curators, the entire property was bought in 2004 and 2005 at a price tag of more than R117m. 

Smiedt said the group had tried to get the best possible price to contribute "some form of retribution for the Fidentia victims".

"I am very happy with the result. I hope the person who bought it unlocks the value for Sante because there is a tremendous surge in the Cape Winelands," he said.

With many out of pocket as a result of the fraud, the curators of Fidentia property holdings had instructed Claremart Auction Group to put the buildings under the hammer.

While those at the auction sipped their complimentary juice and hot drinks, former Fidentia boss J Arthur Brown was in jail serving an effective 15-year term for two fraud convictions.

'State of the art facilities'

The charges related to his handling of investments for the Transport Education and Training Authority and the Mantadia Asset Trust Company between 2002 and 2006.

The Western Cape High Court initially handed him a R150 000 fine and a suspended jail term, but this was successfully appealed by the National Prosecuting Authority. 

Brown's appeals to the Supreme Court of Appeal and the Constitutional Court had both failed.

Held at the swanky One&Only Hotel at the V&A Waterfront, the auction room was packed to the brim with people in business attire and casual wear.

Some clutched at their booklets and looked around at the competition. 

Representatives for telephonic buyers stood on the sidelines, phones at the ready.

The auctioneer touted the properties as a "magnificent investment opportunity".

The hotel, conference centre and resort spa was sold, together with the trademarks and the right to extend the scheme. 

The current tenant, hotel group Orion, would vacate 60 days after confirmation of the sale.

Bidding started off slowly, with a R10m offer, but people soon got into the swing of things.

The booklet described the property as having "a reception area, two exclusive lounges, cocktail bar, billiard room and entertainment facility, with flow to patio and pool, premier restaurant with commercial kitchen and 10 fully fitted luxury suites". The conference centre had "state of the art facilities", while the spa was upmarket and fully fitted.

'Fortunate to have got these prices'

The Bayonne free-standing building had four deluxe spa suites, each with an en suite bathroom, fireplace and patio or balcony.

Two of the villas were four-bedroom, four bathroom. The third was a two bedroom, two bathroom.

John Levine, a co-curator, was impressed with the turnout.

"I am absolutely delighted that after 10 years, we have managed to sell these properties so that we can close down this curatorship, give people this money, and bring this whole tragedy to an end."

He said Brown had made a habit of overpaying. 

"Maybe the curators had wishful thoughts of recovering the money, but we never ever got near those sorts of values. With time the estate has run down so we are very fortunate to have got these prices."

The net proceeds, along with cash from another source, would go to the four creditors.

The Living Hands Umbrella Trust had the largest stake at 89.6%, with 57 427 beneficiaries largely from the Mineworkers Provident Fund.