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Raubex won't carry risk for SA Fence and Gate venture

Sep 02 2016 17:01
Lameez Omarjee

(Duncan Alfreds, Fin24)

Company Data

RAUBEX GROUP LIMITED [JSE:RBX]

Last traded 18
Change 0
% Change 0
Cumulative volume 34493
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg – Construction company Raubex has reassured shareholders that it will not carry the risk associated with providing guarantees for its joint venture with SA Fence and Gate.

Responding to a shareholder at the company's annual general meeting on Friday, chief executive Rudolf Fourie explained that Raubex only has a minority stake of 25% in the venture. As a minority partner, the company therefore cannot provide guarantees.

“Raubex is not in a lead position and had no dealings with Prasa (the Passenger Rail Agency of South Africa),” said Fourie. He was referring to reports that SA Fence and Gate was among the Sasstec Group of companies which came under the spotlight for benefiting from government tenders.

News24 previously reported that SA Fence and Gate is an ANC donor and belongs to the governing party's Progressive Business Forum.

This came to light when News24 first reported that National Treasury raised queries about tender procurement processes followed by the Department of Correctional Services. National Commissioner Zach Modise defied requests for the the chief procurement officer to review the processes in which a contract for the inmate management system was awarded. The contract was awarded to Integritron Integrated Solutions, also part of the Sasstec group.

Read: Exclusive: R378m prisons scandal

However, Fourie explained that Raubex shareholders need not be concerned that the company is implicated. “Our position was just to provide buildings. Once the buildings are complete, the joint venture will come to an end, forever,” he said.

Fourie told Fin24 that the buildings are to be completed within the next two months. After this, Raubex would divest. 

The joint venture began in March 2012. The company put down a guarantee for its portion of the contract which will come to an end in November 2016. 

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