The High Court in Johannesburg has found the liquidators appointed to take the reins at African Global Holdings (AGH, formerly Bosasa), acted unlawfully when they put the controversial company’s assets under the hammer – in what was at the time described as “the auction of the decade” – last December.
Acting Judge De Villiers on Monday declared sales made without the written consent of the board of directors to have been unauthorised.
The acting judge barred the handing over of the immovable assets sold – including the Lindela Repatriation Centre in Krugersdorp, a copper plant, and the company’s West Rand headquarters.
But of the movable assets – which included a number of luxury vehicles – the acting judge said the sales had already been completed.
“I do not know which of the purchasers of movable assets purchased the assets bona fide. That aspect will have to be dealt with on a case by case basis,” he said.
AGH director Jared Watson – the nephew of former the director, the late Gavin Watson – brought an application to have the auction effectively set aside, after his last minute-bid to halt it from taking place in the first place failed.
Watson had launched an urgent application to interdict the bidding war from going ahead pending the outcome of a bid to have AGH placed under business rescue. It was, however, struck from the roll.
But De Villiers on Monday found the provisional liquidators had no authority to continue with the sale of the assets after the application to place AGH under business rescue was made.
“A business rescue application suspends the process of continuing with the realisation of the assets of the company in liquidation,” the acting judge said.
In any case, De Villiers found, the liquidators had acted without the consent of the board, and in violation of a court order
“Without seeking to be unkind, their version is that I must find that they had consent because they say that they had consent,” he said. “They could not refer me to any request for consent to the auction and its terms, who consented, when this happened, where this happened, or what the terms of the consent were given.”
And, the acting judge said further, they knew they had not sought consent – an “extremely disquieting aspect”.
“They were challenged and they pressed ahead as if they are a law unto themselves,” De Villiers added.