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Sanlam, PSG Capital snub Gupta business - report

Apr 24 2016 16:02

Cape Town - Some JSE sponsors, including Sanlam Capital Markets and PSG Capital, are not looking to do business with the Gupta-owned firm Oakbay Resources & Energy, according to a City Press report.

Oakbay will lose its JSE sponsor. This comes after the company lost its auditor KPMG and bankers Absa, FNB and Standard Bank, and after its CEO and chairperson resigned.

The termination by Sasfin Capital would take effect from June 1 2016 after notification was received on March 15. Oakbay will need to find a new sponsor within 30 business days from the date the relationship with the old sponsor ends.

This means the company needs to find a new JSE sponsor by mid-July, or it will be in breach of the listing requirements, according to Andre Visser, the JSE’s general manager of issuer regulation.

City Press quoted an executive from a JSE sponsor stating that Oakbay has probably approached all the JSE sponsors.

"Oakbay and the Guptas are controversial and many of the JSE sponsors are press shy. There is also a question of reputational risk. Sasfin is a respected company and KPMG even more so. I do not know where they [Oakbay] will find a sponsor.”

When City Press contacted companies listed on the JSE as sponsors, some – including PSG Capital and Sanlam Capital Markets – said they would not sponsor Oakbay. A Sanlam spokesperson said: “They are controversial politically and we would not like to get involved with that.”

The other companies refused to comment.

On Thursday Fin24 reported that Oakbay appointed SizweNtsalubaGobodo as its new auditors with immediate effect.

SizweNtsalubaGobodo – which also audits state-owned entities Eskom, Denel, Transnet and the SABC – is an African firm that delivers the full spectrum of audit, advisory and forensic services, it said on its website.

Launched in 2011 through the merger of two leading auditing firms, SizweNtsaluba VSP and Gobodo Incorporated, SizweNtsalubaGobodo has a combined legacy of 29 years and has established itself as the fifth largest accounting firm in southern Africa, it explains on its website.

Other clients include Anglo American, Pick n Pay, Spar and Multichoice.

The Guptas own Oakbay Investments, which is a shareholder in a number of private equity investments and joint ventures, such as Sahara Computers, JIC Mining Services, Shiva Uranium, The New Age newspaper, ANN7 TV and Clifftop Lodge.

For this story and more, read City Press.



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