Listed financial services group Corpcapital is considering making another purchase offer for the financially troubled Central News Agency (CNA), the company said on Friday.
”Corpcapital continues to be interested in CNA,” Corpcapital director Neil Lazarus said.
”We are in negotiations with interested parties with a view to consider making an offer.”
He denied media reports that Corpcapital would definitely make an offer.
”There are huge commercial and legal implications that have to be considered first,” Lazarus said.
Earlier on Friday Corpcapital announced that it had decided not to proceed with its offer of buying CNA for a rumoured R1.
It had said it was no longer satisfied with the outcome of its due diligence investigation into CNA.
CNA chairman Mark Gordon said that Corpcapital had asked for an extension of the probe to August 28. The deadline for the finalisation of the investigation was Thursday.
He said this would have meant Corpcapital would have had exclusive rights to CNA’s financial records until August 28.
CNA’s owners Gordon Kay & Associates, its board of directors and creditors turned down the request for extension as it would have been to the detriment of the news agency, Gordon said.
CNA and the Consolidated News Agency — CNA’s franchise stores — were placed under judicial management on Wednesday to give them court protection against possible liquidation while a new buyer is found.
While CNA, which has debts totalling more than R100-million, is under judicial management, its managers cannot conduct business as usual.
Gordon said this was why some branches did not have items such as newspapers and magazines in stock, but this was expected to be rectified soon.
Two judicial managers were appointed on Friday and a couple more would be appointed next week. Gordon said he hoped CNA would be back to business as usual by Monday.
Trouble started at CNA after it failed to pay an outstanding balance of R70-million to Wooltru earlier this year.
Gordon Kay & Associates bought CNA for millions of rands from Wooltru last year. It defaulted on the outstanding balance in about June this year.
Gordon said the market thought that CNA could not pay its debts and there was a run on the news agency.
”The terrible thing is that CNA has never been healthier,” he said. ”It is doing better this year than it did last year.”
The problem lies with many of the franchise stores which are in debt.
Asked about the future of CNA, Gordon said there was ”lots of interest from buyers”.
He said there were at least four potential investors who he would not name, fearing that they might pull out.
Meanwhile CNA employees in Johannesburg suburbs were not fully aware of what was happening at the company.
A worker, who did not want to be named at the CNA in Greenside, said: ”We have been told a little bit by management and the rest we read in the newspapers”.
She said she did not wish to comment, but had received her salary for last month. An employee at the CNA in Cresta claimed that she was not receiving her normal payments for working on Sundays.
”They usually pay me about R286 for Sunday work but I got R95 for the last two Sundays. It costs me about R80 to come to work and go home every day. I got R95 for two Sundays. What is that?”
The irate woman, who also did not want to be named, said customers had been losing their tempers with her because the store was not stocked with its regular magazines and newspapers.
”They (CNA management) only told us two weeks ago what was really happening, but we are hearing different stories from everybody. I don’t know what I must tell customers about the stock. I am very stressed,” she said.
CNA, which sells goods including stationery and books, has been in operation for 108 years. – Sapa