In a statement on Friday, Public Works and Infrastructure Minister Patricia de Lille confirmed that the state has exercised its right of first refusal to acquire control of Bosasa’s Lindela Repatriation Centre in Krugersdorp after it reached an auction price of R60 million earlier this month.
The facility’s market value is anywhere between R160 million and R200 million, while one source told The Citizen earlier this month that to rebuild such a facility from scratch would probably cost R300 million.
The facility is currently being run by Enviromongz after the Bosasa contract had to be ceded to them earlier this year.
The sale to an unknown bidder from Limpopo took place on the second day of sales by liquidators, who were raising funds to ostensibly repay the troubled company’s creditors and the SA Revenue Service (Sars), which claims it is owed more than R500 million by Bosasa.
De Lille said her department had matched the R60 million offer and, as a result, they had secured a “superb return on investment at 9.75%” and would realise a saving of nearly “R1.3 billion” per year, though the department had apparently meant to say this saving would take place over 12 years.
Sars opposed an interdict from African Global Holdings director Jared Watson against the auction, as well as the company’s attempt to go into business rescue.
The transit centre has become infamous for being something like a prison for undocumented migrants awaiting deportation. Bosasa, which was later rebranded African Global Operations, also had experience with running tenders in actual prisons.
Bidding for Lindela had started at R30 million, with Park Village Auctions explaining that the department of public works still had a monthly lease on it of about R1 million. The running of the centre had been outsourced to Bosasa since 2003.
Lindela is the only facility of its kind in South Africa.
In 2014 the SA Human Rights Commission and other applicant organisations argued that Lindela’s practices regarding detention at the facility were unconstitutional and in contravention of the Immigration Act and had to be changed.
The 26-hectare Lindela used to be a mining compound, but was converted by Bosasa, and even features a workshop and soccer field. It was reported by the DA this year that Bosasa received about R1 billion to manage the facility in 2005, with renewals of half a billion each year after that for another five years.
Last month the Supreme Court of Appeal (SCA) found in favour of keeping the company in liquidation, emboldening the auctioneers, who had already started advertising the event
Bosasa had gone into voluntary liquidation in February following their banks announcing they would be closing all of the company’s accounts due to corruption allegations.
Bosasa subsequently tried to reverse the liquidation but the SCA upheld an appeal by the provisional liquidators to keep the company in voluntary liquidation.
