Gold Circle - absolutely mind blowing

Do any of the KZN boys know the story behind Gold Circle getting screwed out of their share in PGE? I was told something yesterday that quite frankly amazed me. After initially writing it off to exaggeration, I did some research and it seems to have some legs. The story told simply, and probably not 100% accurately, is as follows:

Phumelela and Gold Circle ( this comprised of KZN and the WC at the time ) set up a business partnership that involved the broadcasting and selling of SA races to the foreign markets. The ownership composition was Phumelela 69% and GC 31%. This agreement extended to the ownership of Tellytrack, and explains why GC felt they had a right to take over TT when Phumelela went under way back when. To make a long story short, this was a highly profitable partnership and GC received their correct dividend from Phumelela for many years. Let me say that following the de-merger of GC, KZN continued to receive dividends from Phumelela. I cannot find documentation showing exactly what the new percentage was, but have been informed by a variety of sources that the amount was now either 24% or 25%. This agreement went on for many years and from all accounts was a very profitable enterprise. I am told that it was Gold Circles single biggest form of revenue.

The story gets interesting after Phumelela went into Business Rescue. I am told that the Business Rescuer asked Gold Circle for proof of their 24/25% ownership, and unbelievably these part timers cannot provide this. You heard that right. The Gold Circle board have no commercial agreement documented with regard to their involvement in PGE. There are apparently also no recorded board resolutions in this regard. They have no way of proving ownership and therefore have lost out on this revenue stream as the business rescuer has rightly witheld payments until ownership can be proven. To make things even worse, I am told from an extremely reliable source that the GC board are not exactly setting the house on fire trying to set the matter straight and reclaim their share. One French speaking big shot has the view that they did well out of the agreement for many years and should leave the matter unchallenged.... The mind boggles and I wonder if the GC board thought that they were running the neighborhood tennis club? If I were an owner in KZN I would be calling for the heads of the entire board.

I am sure that there is more to this story, it would be good to hear from those more in the know.

....it has always been openly known that CG had this arrangement with PGE.....but hell man dont people keep proper records that attest to these kind of agreements....very reminiscent of the verbal stakes agreement that the RA had custody of...:whistle:

Maybe the contract was not cast in stone, but the Judge will take into account that GC have received a regular payment.

Black Arthur wrote: Maybe the contract was not cast in stone, but the Judge will take into account that GC have received a regular payment.

Black Arthur you may well be correct but my sources tell me that there is little to no appetite coming out of GC to fight this. This is backed up by the business rescuer who in his latest report says the following:

2.8. preparing for the potential court process to resolve Gold Circle’s alleged claim to own 39% of the issued share capital of Phumelela Gold International Limited(“PGI”). We were hoping that Gold Circle would have launched their proceedings by now, unfortunately they have not and we are engaging with their attorneys to do so without further delay

This seeming reluctance to establish what is supposedly rightfully Gold Circles entitlement is confusing. Or is it? I wonder how the internal auditors ( Hello Hazel Kiyaya! ) made provision for revenue recognition on a verbal agreement? Taken from the Institute of Chartered Accountants website:

From January 2018, the new revenue recognition requirements come into effect. The new revenue financial reporting standard (IFRS 15 – Revenue from Contracts with Customers) establishes a single comprehensive framework for determining when and how much revenue a company should recognise in the financial statements.
IFRS 15 is effective for annual reporting periods commencing from 1 January 2018. Companies should also consider what disclosures to provide in the financial statements prior to 2018 in respect of this standard which is not yet effective as per the requirements in IFRS (IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors).

I am pretty sure that there are breaches from both Phumelela and GC sides.

From Craig

Please reply that GC, as per the Chairman’s address at the AGM held on 28 jan, are currently involved in litigation with the BRP to prove rightful ownership.Rgds

It would be as easy as producing a binding agreement to stop this farce. Is there one or isn't there? It seems quite clear that GC are going to attempt to rely on past payments to justify their "rightful" ownership.

Let me assist GC by pointing them to a decision taken by the Rescuer with regards to the previous stakes agreement in Phumelela country. He ruled that the agreement held no water and refused a R345M claim. MOD have sought council on this matter and have been advised that they have no case. Why do you will be treated any differently do you think? The BPR acts on behalf of Phumelela, what he isn't obliged to pay, he wont.

The question as to how GC find themselves in this embarrassing situation remains.

So many clowns so little tents.

This reminds of The People Vs Larry Flint

So the business rescue practitioner states there is no agreement in place to get paid.

FAIR ENOUGH

Then surely a criminal case must be made against the person that paid it every month?

Surely then that money was stolen from Phumelela and Gold Circle must pay it back?

or

There was an agreement in place ( as everyone knows) and fuc k the practitioner and MOD as they clearly
have their own agenda.

As an owner in KZN (however NEVER invited to any meeting (clowns)) This is easy peezy to sort.
cut the cable feeding the pictures and fu ck em all. Wont be long before this is sorted, 1 maybe 3 meetings.

......with and effective legal team it would not be too hard to prove that a precedent has been set and for them to prove that the payments were for a contractual arrangement.....:huh:

.....however if the legal boffs botch it....school fees..... and a lesson not to do things Island style....:lol:

Not sure if Phumelela have the same legal team they used for "open bet"?

If they do GC must be money on 👍

Dave Scott wrote: Not sure if Phumelela have the same legal team they used for "open bet"?

If they do GC must be money on 👍

that is seriously funny, great chirp

easy wrote:

Dave Scott wrote: Not sure if Phumelela have the same legal team they used for "open bet"?

If they do GC must be money on 👍

that is seriously funny, great chirp

Phumelela have nothing to do this this, this all all the BRP.

....wonder if dear John.... the ex CEO is still willing to step up to the plate to back up his initial avadavat....:huh: :huh: