Cape Town - Testifying on Tuesday, in the PIC v AYO court case currently being heard in the Western Cape High Court, former African Equity Empowerment Investments (AEEI) chief investment officer Malick Salie told about the valuation of Ayo Technology Solutions (AYO) shares.
Responding to a question from the Public Investment Corporation’s legal counsel, advocate Vincent Maleka, Salie said there was an assumption that British Telecom South Africa (BTSA) customers would transfer to AYO and raise the valuation.
He said the data on the valuation was obtained from BTSA.
Under cross-examination by AYO counsel Nazeer Cassim, Salie said the information used for the valuation was furnished by the former BTSA managing director and senior people at the entity.
He agreed with Cassim’s proposition that they had no reason to suspect that there was anything untoward with the data.
Salie also said audit firm Grant Thornton had reviewed all the information and had asked where it was sourced.
Salie’s testimony will continue on Wednesday.
Earlier on Tuesday, incumbent BTSA managing director Bertrandt Delport backtracked on some of the evidence he had given to the court in previous testimony.
Delport, too, was testifying in the matter where the PIC wants to recover the R4.3 billion investment for a 29% stake in AYO it made when AYO listed on the JSE in December 2017.
AYO’s senior legal counsel, advocate Karrisha Pillay, grilled Delport on the 30% shareholding in BTSA which was held at the time by AEEI and which AYO would subscribe for upon listing.
Pillay took him through the prelisting statement (PLS) document that was part of a transaction where it was intended to sell shares held in BTSA to AYO.
She put it to Delport that the 30% was touted as part of the transaction where AYO intended to buy shares, then held in Kilomix, which is owned 100% by AEEI.
His response was: “Yes.”
Delport said there was a review of the contractual framework to ensure there was no “fronting” by transferring portions of functions to AYO.
He also said he accepted that there was going to be a two-way relationship between the two parties.
Delport could not say if there was nothing to suggest the document had errors and its content inaccurate.
“I can’t speak on that,” Delport said.
When asked about the non-binding AEEI memorandum of understanding (MoU), he said: “If read with definitions, it is fine. The definitions make it non-binding.”
Pillay put it to him that the MoU made provision for the subscription of BTSA shares to be subject to certain conditions.
When asked what his issue about the pre-listing statement’s non-binding arrangement and conditions attached to it were, Delport said it did not disclose that it was subject to BTSA approval.
Delport raised concerns that an impression had been created that there would be a takeover of BTSA shares by AYO.
Pillay asked him if he accepted that there was a strategic relation to all parties and as result certain functions flowed to AYO: Delport said: “If they materialise, yes.”
When PIC counsel Duncan Wild re-examined Delport about the contracting model that was to be followed, he said it was part of a process that eventually went to the global leadership team.
“It did go as part of ongoing consultation,” Delport said when asked if it was approved.
Cape Times