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Gupta associate abandons court bid against Transnet pension fund

Oct 01 2019 13:10

Eric Wood, who is a shareholder in the Gupta-associated firm Regiments, has abandoned an urgent application seeking to prevent the Transnet Second Defined Benefit Fund from clawing back R500m in damages from Regiments.

AmaBhungane previously reported that the TSDBF has set out damning allegations against Wood, including that he set up a scheme to launder the proceeds of corrupt contracts the Guptas swung the way of Regiments Capital.

Regiments is the financial services company where Wood was a director before a fallout with his co-directors over the terms of his departure to Trillian, a successor company set up by Gupta lieutenant Salim Essa.

TSDBF has struck a deal to get back R500m (discounted from R825m) from Regiments, based on the latter’s allegedly corrupt appointment to manage the fund's assets.

Litha Nyhonyha and Niven Pillay, the majority shareholders and remaining directors in Regiments, are fingered as "co-conspirators" with Wood – but they have signed the deal with the TSDBF, partly, it seems, to try to regain control of Regiments, which has had all its assets frozen by the fund, AmaBhungane reported.

Wood earlier launched an urgent court application to quash the deal, claiming his former colleagues are using the company's money to save themselves, leaving him to face the music.

The TSDBF hit back hard, setting out in detail the evidence of Wood's role in arrangements which saw more than 50% of Regiments' revenues from Transnet funneled off to letterbox companies the fund says were fronts for the Guptas.

According to a TSDBF statement, released on Monday, Wood withdrew his application for an urgent interdict on certain conditions.

The deal would compensate the TSDBF to the tune of R500m plus a 10% discount on the market value of 810 230 Capitec shares that Regiments controls as a result of a 2006 empowerment deal. The settlement would involve the TSDBF buying all of these Capitec shares, the first R500m at Regiments' expense, AmaBhungane reported

But Capitec is opposed to the deal, and has filed a court application to stop it. The case will be heard in the South Gauteng High Court on Wednesday morning.

Andre du Plessis, chief financial officer of Capitec, earlier said that Transnet wants it to pay the price for the state-owned entity's "mistakes" in dealings with the firm Regiments.

Capitec believes "persons and entities involved in state capture will improperly benefit". Also: it issued those shares to a BBBEE group to "create an enduring ... empowerment transaction", which is now defunct.

"Transnet has reached a settlement agreement with parties implicated in state capture - at the expense of Capitec," Du Plessis said in a statement.

Compiled by Helena Wasserman.

capitec  |  eric wood  |  guptas
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