The debt is “fully secured on underlying collateral which is predominantly property,” Ursula Nobrega, head of investor relations at Investec, said in an emailed response to questions late on Wednesday.
Investec Asset Management, the company’s money management arm, has invested client funds in First Strut bonds, said Nobrega. That unit declined to disclose details of client exposure in a separate statement on Wednesday.
First Strut, a manufacturer supplying the transport, mining and power industries, was placed in provisional liquidation on July 16, said John Louw, business rescue practitioner for the firm that employs more than 5 000 people. That came after Jeff Wiggill, chairman of the company which also trades as First Tech Group, was murdered last month.
Wiggill, 59 was found next to his car in Soweto with bullet wounds to his head, the South African Press Association reported June 20. His wallet and mobile phone were missing and the motive for the killing was unknown, SAPA said, citing police captain, Augustinah Selepe.
First Strut chief executive Andris Bertulis was unavailable for comment yesterday, according to an emailed response from Megan Bell at First Tech Group.
First Strut, which sold R450-million of senior secured bonds in 2011, has R925-million of floating-rate notes outstanding, according to data compiled by Bloomberg. Global Credit Ratings withdrew its coverage of First Strut bonds this month, after initially rating them BBB.
Standard Bank Group, which was named in bond documents on First Strut’s website, declined to comment because of client confidentiality agreements, said Ross Linstrom, a spokesman for the Johannesburg-based lender.
“Nedbank is one of a number of financiers that has credit exposure to the First Strut Group of companies and is adequately provided,” Mike Brown, the bank’s chief executive officer, said in an emailed response to questions late yesterday.
Rand Merchant Bank, the investment banking unit of FirstRand, acted as lead manager for the sale of First Strut’s R925-million bond. With First Strut under provisional liquidation, RMB doesn’t want to comment on the matter, spokeswoman Joandra Griesel wrote in emailed comments.
Investec fell 1.7% to R67.60 as of 10:05 am in Johannesburg, while FirstRand declined 0.7%. – Bloomberg