Mzolisi Diliza may have to open the books of Miganu Investment Holdings as the Johannesburg high court gets involved.
The war for the Growthpoint Properties black economic empowerment shares is heading to court.
Last month Mlibo Mgudlwa, director of Africa Wide Investment Holdings, approached the Johannesburg high court to compel business mogul Mzolisi Diliza to open the financial books of Miganu Investment Holdings.
The Mail & Guardian reported last year on Mgudlwa’s claim that Diliza had unilaterally removed Africa Wide from the Growthpoint empowerment scheme. This occurred less than two years after Africa Wide was made a shareholder of Miganu Investment Holdings in 2005.
Mgudlwa said that he had been trying to get more information from Diliza, without success.
When Growthpoint embarked on the deal, it was the biggest black empowerment deal at the time. According to the stock exchange news service, one of the empowerment partners to benefit from the transaction consisted of three companies: Amabubesi Investments, Miganu Investment Holdings and Unipalm Investment Holdings. The transaction at the time was worth R1-billion.
According to a notarised relationship agreement from 2005, Africa Wide was a direct shareholder of 11% in Miganu Investment Holdings.
Mgudlwa said his company was removed as the direct beneficiary — even though it had this shareholding. According to the court papers, Mgudlwa claims that Diliza unlawfully excluded African Wide from becoming a shareholder in the multimillion-rand empowerment share scheme. This also excluded them from dividends.
Mgudlwa is asking the court to compel Diliza to provide a full account of all the affairs of the consortium — Miganu Investment Holdings — including its financial information, and what the dividends were meant to be.
“Despite written demand by the plaintiff [Mgudlwa] on the 31st of January 2019 that the defendant remedy the breach,the defendant [Diliza] failed to do so. Consequently, as a result of the defendant’s breach and unlawful conduct as aforesaid, the plaintiff has suffered damages, including the full value of such 11% interest in [the consortium],” the court papers read.
Diliza confirmed to the M&G that his company has received notice of Africa Wide’s court action. He said the company sees no merit in it. It has filed its intention to defend the case.
Diliza said: “Miganu has, for a number of years, continuously attempted to resolve this matter through discussions between the parties, and is disappointed that Africa Wide did not take up its offer to try to resolve the matter, but instead launched their court action.”
Last year Diliza told the M&G that he had picked Africa Wide as one of the prospective shareholders.
Growthpoint was sent questions regarding the court application,but had not responded at the time of going to print.
Last year the company’s chief executive Estienne de Klerk said it was far removed from the relationship between Africa Wide and Miganu, and did not want to get involved and dictate who the black empowerment shareholders should choose as partners.