The chair of Ayo Technology Solutions, Wallace Mgoqi, died on Monday evening just days after doing media interviews about the software and technology group’s settlement with the Public Investment Corporation (PIC).
He joined the board of the company, valued at R1.65bn on the JSE, in 2018 and according to a company statement was a champion of its “BBBEE mandate to transform the SA ICT sector”.
“A respected member of the judiciary, a champion of human rights and a keen business mind, Wallace was also very much a loving family man and a man of the people,” the company said in a statement on Tuesday. “SA is all the poorer for his loss.”
In 2021, Mgoqi was on the list of eight potential replacements for Mogoeng Mogoeng as chief justice before he withdrew his nomination, citing his age of 72 years at the time and his health. Raymond Zondo was eventually appointed.
Ayo, which was indirectly controlled by Independent Media owner Iqbal Survé, commended Mgoqi for his support in carrying the company through “years of tribulation at the hands of repeated inaccurate media reporting” as it took a swipe at other media outlets for its reporting on the company, claiming that it “ultimately it took its toll”.
Business Day reported last week that a legal opinion sought by the PIC advised it to settle its long-standing dispute with Ayo, saying the prospects of recouping its R4.3bn investment in the company in 2017 were grim.
This investment was made via the PIC’s participation in Ayo’s initial public offering through a private placement in December 2017, which valued the firm at R14.8bn. Ayo is now valued at R1.5bn on the JSE.
Survé and former PIC CEO Dan Matjila’s relationship came under scrutiny at the Mpati Commission, which probed allegations of impropriety at the PIC. Matjila and Survé both told the commission that the PIC’s R4.3bn investment in Ayo was above board and that the state-owned fund manager followed all prescribed investment policies.
Matjila defended the PIC’s investment at the commission, saying that he still believed there was value in the company despite the losses incurred.
Survé and the Sekunjalo Group last year filed for a formal legal review of the Mpati Commission’s report.
The PIC and Ayo surprised many observers two weeks ago in announcing they had abandoned litigation and reached an out-of-court settlement, the details of which they said would not be made public.
But on Monday, Ayo confirmed some of the terms and conditions of its settlement deal with the PIC in terms of which it will repurchase R619m in Government Employees Pension Fund (GEPF) shares.
It said in a statement that it would repurchase 17,202,756 ordinary shares in issue from the GEPF for R619m. It said subsequent to the initial repurchase the GEPF will retain a minimum stake of 25.01% in the company.
“The GEPF has the option, after a period of three years from the date of the initial repurchase, to sell up to a further 5% of the Ayo shares that it holds at the higher of R20 per Ayo share and the prevailing 90-day volume weighted average price of Ayo shares traded on the JSE, subject to JSE regulatory approvals and the solvency and liquidity of the company,” Ayo said.
Another condition to the settlement is that the GEPF will for every 10% of the shares it holds in Ayo be entitled to nominate one director to the board of directors and will have to approve of the appointment of the chair.
“The GEPF may not unreasonably withhold approval for a resolution by Ayo shareholders authorising Ayo to render financial assistance to the subsidiaries of Ayo, and subject to regulatory approvals.”
With Kabelo Khumalo
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