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The Citizen
a day ago
- The Citizen
SIU blocks R3.3 million pension payout of former Gauteng HOD
The SIU secured a court order stopping Gasela's pension payout as criminal investigations continue into corruption and fraud allegations. The Special Investigating Unit (SIU) has secured a court order stopping the pension payout of a former Gauteng head of department (HOD) as criminal investigations continue into corruption and fraud allegations. The unit obtained an interim order from the special tribunal to stop the Government Employees Pension Fund (GEPF) from processing about R3.3 million in pension benefits for Matilda Matozi Gasela, the former HOD at the Gauteng department of agriculture, rural development and land reform. Additionally, until the legal proceedings are concluded, Gasela is prohibited from accessing or claiming these funds under the order which was given on May 15, 2025. Gasela allegedly played key role in mismanaging trash-collecting vehicles contract Gasela began her tenure as HOD in 2018 and allegedly played a key role in mismanaging a contract with Enviro Mobi (Pty) Ltd (later known as Groen Mintirho). SIU spokesperson Kaizer Kganyago said that Gasela authorised additional payments and approved a R6 499 712.64 settlement for 'storage costs' — an item not included in the original contract — even though the company failed to deliver the vehicles. ALSO READ: SIU to investigate Defence department's surgical mask tender from 2021 Senior counsel explicitly advised against this payment, which was later declared fruitless and wasteful expenditure. 'Her actions allegedly contravened the Public Finance Management Act (PFMA) and contributed to the depletion of public funds, as the SIU contends, in what it describes as a fraudulent scheme,' Kganyago said. After discovering evidence of criminal activity, the SIU referred the case to the National Prosecuting Authority (NPA). The SIU sent this evidence to the NPA to consider pursuing criminal charges against Gasela, including fraud, corruption and maladministration. October 2024 arrest In October 2024, authorities arrested Gasela and her six co-accused. Her co-accused include: Loyiso Mkwana, chief director: sustainable use of environment, who also served as the bid evaluation committee chair. Thandeka Mbassa, former HOD. She left in August 2018. Abdullah Mohamed Ismail, former chief financial officer and chair of the bid adjudication committee. Matlhekelo Elsie Mabe, director of Mvest Trading (Pty) Ltd. Tinyiko Mahuntsi, director of Enviro Mobi. Puleng Peter Mabe, former director of Enviro Mobi and a former member of parliament Infographic: Supplied ALSO READ: NPA lacking in lottery probe The accused appeared before the Palm Ridge Specialised Commercial Crimes Court inJohannesburg. They were linked to financial mismanagement and illegal procurement in connection with the R33 million contracts that the Ekurhuleni metropolitan municipality (EMM) and the department gave to Enviro Mobi. Kganyago confirmed that the SIU filed papers in the special tribunal to review and cancel the contract and recover R33 731 463.64 in financial losses suffered by the state. R33m financial losses 'Furthermore, as part of consequence management, the SIU has made disciplinary referrals to the department against implicated officials. An administrative referral was made against Enviro Mobi for blacklisting,' he said. According to Presidential Proclamation No. R.15 of 2021, the SIU was tasked with investigating claims of maladministration in the department and Ekurhuleni specifically concerning the contracting or purchase of 200 portable three-wheel motorised trash-collecting vehicles. ALSO READ: Thrrr…Phaaa: Musician Selaelo Selota's Mercedes frozen as SIU probes misuse of lottery funds During the 2023/24 financial year, the SIU finished its investigation into this issue and delivered the report to the president.
The Citizen
16-05-2025
- Business
- The Citizen
Is Cell C using Pick n Pay/Boxer's strategy? Broke mobile network plans to list on JSE
As of February 2025, Blue Label's financial results revealed that Cell C remains technically insolvent, with its liabilities continuing to exceed its assets — a condition that has persisted since shortly after 2019. Blue Label acquired 45% of Cell C in 2017. Pictures: Blue Label and Cell C Facebook pages Blue Label, parent company to Cell C is looking at restructuring the business, which will allow a separation and potential future listing of struggling mobile network, Cell C on the Johannesburg Stock Exchange (JSE). According to reports, Cell C's financial woes began around 2015, when it was unable to make a profit despite reselling airtime. It was during a restructuring process that created three special purpose vehicles to restore Cell C's debt, following Blue Label's acquisition of a 45% stake. Mobile network still technically insolvent The company's financial challenges intensified, and it began a restructuring process that included a recapitalisation in 2022 to reduce debt. In early 2021, Cell C began migrating its customers to roam on partner networks, specifically MTN and Vodacom, and deactivated its physical towers and RAN in June 2023. Blue Label's financial results in February 2025 showed that Cell C is still technically insolvent, meaning its liabilities exceeded its assets, which has been an issue since 2019. The financial results showed that the mobile network had a negative equity of -R3.3 billion. Negative equity means that a company will not be able to settle all of its liabilities with its assets if it is liquidated. Analysts warned Blue Label that acquiring a stake in Cell C is not a very good idea, because the South African telecommunications market is dominated by Vodacom and MTN. Plans to list the mobile network Blue Label's Stock Exchange News Service (SENS), said, 'the proposed restructuring is expected to encompass various ancillary transactions, aimed at optimising Cell C's capital structure and balance sheet in preparation for a potential separation and future listing on the JSE. 'Should Blue Label elect to implement the proposed restructuring, it is envisaged that the various restructuring steps will be inter-conditional and contingent upon the potential listing of Cell C. 'The implementation of the restructuring and potential listing will remain subject to, among other conditions, approval by the boards of Blue Label and Cell C, requisite shareholder and regulatory consents, and favourable market conditions.' How the restructuring will work • 'Airtime asset transfer: The Prepaid Company Proprietary Limited ('TPC'), a wholly owned subsidiary of Blue Label which holds shares and debt claims in Cell C, will transfer Cell C airtime currently held by TPC on its balance sheet to Cell C in exchange for newly issued additional equity in Cell C. • 'Debt-to-equity conversion: TPC's outstanding debt claims against Cell C will be capitalised and converted into equity, further reducing Cell C's leverage. •' Acquisition of Comm Equipment Company Proprietary Limited ('CEC'): Cell C will acquire 100% of CEC (a wholly owned subsidiary of Blue Label) from TPC in exchange for additional Cell C shares. CEC is a subsidiary responsible for Cell C's postpaid offerings. The internalisation will enable Cell C to assume full responsibility over its postpaid customer base, including oversight of supply chain, commercial operations, marketing, billing, credit, and collections. • 'SPV restructure: The Special Purpose Vehicles (SPVs) currently holding equity interests in Cell C will also be restructured as part of the broader initiative, aligning their ownership structures with the redefined capital framework.' ALSO READ: Cell C has suspended 400 workers, but it's not about race, says ICTU How does listing make money? According to the JSE, listing a company primarily benefits the company by enabling it to raise capital through public share offerings. This capital can then be used for various purposes, such as expansion, debt repayment, research and development, or gaining a competitive advantage. 'Well-established companies seeking equity funding to grow their business list on the Main Board. Almost a fifth of the Main Board companies are dual-listed. This means that a company is listed on two or more exchanges. 'If a company has a secondary listing on the JSE, it has its primary listing on another exchange and is regulated by the exchange holding its primary listing. Companies have secondary listings to enable them to raise capital in markets other than the market accessed by their primary listing.' Pick n Pay lists Boxer to make money Pick n Pay Group listed its pride and joy, Boxer, on the JSE with the aim of taking it out of its financial woes. Before the listing, Pick n Pay Group was technically insolvent; the retailer's revenue increased from R109.28 billion to R115.37 billion, while trading expenses rose from R20.15 billion to R22.55 billion. Total liabilities exceeded total assets by R183 million. However, CEO Sean Summers said the retailer has a strategy to turn the ship around, including the listing of Boxer. 'The Boxer IPO remains pivotal to our strategy, and their remarkable performance continues to prove it is an exceptional business. We are excited to see it thrive as a listed entity,' said Summers. Through Boxer's initial public offering (IPO), Pick n Pay was able to raise more than R8.5 billion from the 157.4 million shares allocated to qualifying investors at a share price of R54. Pick n Pay still owes 63% of Boxer. NOW READ: How did Pick n Pay do it? From technically insolvent to growing sales in months
IOL News
23-04-2025
- Business
- IOL News
eThekwini unveils R71.3bn 'construction site' vision in new municipal budget
The eThekwini Municipality 2025/26 draft budget is expected to prioritise infrastructure development, job creation and social upliftment. The eThekwini Municipality draft budget for 2025/26, dubbed 'building and service delivery budget', is expected to prioritise infrastructure development, job creation, and social upliftment. The total proposed budget for 2025/2026 is R71.3 billion (including entities), which includes an operating budget of R64.2 billion and a capital budget of R7.1 billion. At a council meeting on Monday, Mayor Cyril Xaba said he would like to turn eThekwini into a construction site. Xaba said the budget also reflects inclusive growth and economic resilience, and described the budget process as 'difficult to balance', considering the current challenging economic climate. He said it also focused on expanding public transport networks, support for small businesses, and decent human settlements. Recent floods have caused extensive damage to electricity, water, and sanitation infrastructure. Rapid urbanisation continues to place new demands on infrastructure, he added. 'One of the key national policy developments that will impact this budget is the National Treasury's Trading Services Reform, which seeks to enhance the financial sustainability of our utilities such as water and sanitation, and electricity.' As part of this reform, municipalities must improve cost recovery mechanisms, reduce inefficiencies, and ensure that tariffs reflect the true cost of service provision while remaining affordable to vulnerable communities. eThekwini could receive R3.3 billion for reforms in the 2025/2026 Medium-Term Revenue and Expenditure Framework (MTREF). Capital budget Electricity: R859 million Water: R1.15 billion Sanitation: R550 million Cleansing and Solid Waste: R375 million Engineering Services: R482 million Human Settlements: R749 million Community and Emergency Services: R590 million eThekwini Transport Authority (ETA): R747 million Operating budget Electricity: R23.3 billion Water: R9.98 billion Sanitation: R2.4 billion Cleansing and Solid Waste: R2.4 billion Engineering Services: R2.67 billion Human Settlements: R971.8 million Community and Emergency Services: R7.18 billion eThekwini Transport Authority (ETA): R1.63 billion Democratic Liberal Congress (DLC) Leader Patrick Pillay said he did not support tariff increases that would bring about greater hardship for residents. Pillay said people's voices must be heard, and this process will allow the public to actively participate in determining the budget outcomes. He added that the multibillion-rand draft budget had very critical capital projects in terms of water and electricity infrastructure rehabilitation as well as an operational budget for repairs, cleaning, and maintenance. 'This is critical to enhance service delivery. The public participation process must be meaningful and constructive. We also lambasted the huge unfunded mandate costs of R1.2 billion, the high water loss of 56%, and the owing government debt to the city,' said Pillay. ActionSA KZN Provincial Chairperson Zwakele Mncwango said the draft budget had a blatant disregard for its residents by pushing forward exorbitant tariff increases that will further burden struggling households and businesses. 'While we aim to prioritise residents, other political parties and the eThekwini Metro continues on its destructive path of financial mismanagement and wasteful spending. This municipality has a notorious history of writing off unauthorised, irregular, fruitless, and wasteful expenditure,' Mncwango said. Democratic Alliance (DA) Councillor Andre Beetge said one cannot lose sight that the core inflation rate is presently 3.5%, with headline inflation projected to average around 4.5%. 'We also hear that Nersa will be enforcing an electricity increase of 12.74% and Umgeni will burden the city with an increase of 13.5% against water, but why should the already overburdened ratepayers of this city be expected to foot the bill for the failure of national and state-owned entities to properly manage their institutions?' Beetge said the city is losing 56% of its water, through non-revenue water. 'Taps are running freely as there are no measures to monitor or control non-revenue water, yet we are again expecting, through these increases, for those who contribute to the fiscus to bridge these losses?' he said. 'Whether you listen to the Auditor-General, Public Protector, or Presidential Working Group, all are in agreement that the city is broken, that we need to cut away the fat, we must forego luxuries, eliminate exercises like expensive mayoral breakaways in the Drakensberg, we must plan to save to fix,' Beetge said. [email protected]
