Jacquie Golding-Duffy
Capital Radio, a former homeland broadcaster, is up for sale, but no bids have yet been received as the station’s financial books are in disarray.
Investec Bank is handling the bidding process, as it did for the sale of the SABC’s six radio stations.
According to sources at the Independent Broadcasting Authority (IBA) and an insider at the Postmaster General’s office, Capital Radio’s financial records have not been audited for three years and its accounts are not in order.
Until this is rectified, potential buyers are unable to conduct a due diligence procedure which allows the study of the station’s books to value the assets for sale.
Capital Radio’s worth is unknown because of accumulated debt, among other things.
IBA representative Amos Vilakazi says the Telecommunications Ministry wanted the sale to be finalised by the end of this month, but, owing to Parliament’s early recess, this was not possible.
The ministry is planning to amend the Broadcasting Act, which has to be approved by cabinet to allow the IBA to grant a licence to the successful bidder before the end of September.
Capital Radio station manager Fred Pearson and Vilakazi confirmed that the government was funding the station until the end of September.
However, they were unsure how much money was being pumped into it, but some estimates are R800 000 for staff salaries and operational costs until the end of September
A board of directors was responsible for the management of the radio station and, according to newly appointed managing director Thembekile Ndlovu, “a can of worms has been opened” with regard to the station’s auditing.
Ndlovu says the auditing for the 1995 financial year has been completed and work was in progrsess to complete the financial records for the1996 financial year.
“My brief is to act as caretaker of the station until such time that it is sold,” Ndlovu says, adding that queries regarding the unkept books must be directed to the board of directors.
Herbert Jikela, outgoing managing director and current board member, denied the books were in disarray, saying “everything is in order”.
Other board members include Gordon Noda (chair), At Sigcu and Peter Cressy.