Tigon To Ask Appellate Division To Rule On New Law
PRESS RELEASE
Financial services company, Tigon, has noted an appeal to be heard before the
Appellate Division in Bloemfontein against the ruling of the Natal Provincial
Division (NPD) which dismissed Tigon's appeal against the judgment of Acting
Judge Aboobaker in February this year, granting a spoliation order in favour of
Bestyet and ordering Tigon to restore Bestyet's name to its share register in
respect of 7,671 million shares issued to Bestyet for the purchase of 30% of
EuroPoint.
Tigon's senior counsel believes that this judgment constitutes new law on
complex aspects dealing with spoliation of the right to registration on a
company's share register, avoided by previous judgments in the Appellate
Division. As new law, this has far-reaching consequences for corporate South
Africa, and Tigon's counsel advise that the correct forum for such new law is
the country's Appellate Division.
Whilst the NPD decision deals only with Bestyet's name bein recorded on Tigon's
share register (and not lawful entitlement to those shares), the issue of
whether Bestyet is entitled to any shares at all will be heard in the
Witwatersrand Local Division of the High Court (WLD). This follows Tigon's
institution on 2 April 2001 of an action claiming restitution arising out of
the cancellation of the purchase of EuroPoint based on fraudulent
misrepresentations by Gavin Varejes and Tony Strike (representing the EuroPoint
vendors) which resulted in material overstatement of the purchase consideration
for EuroPoint.
The NPD decision has no impact on the outcome of the fraud action in the WLD.
The Tigon group has applied for an interim interdict restraining the EuroPoint
vendors from alienating, donating, transferring or in any way dealing with any
of the 7,671 million shares from 9 April 2001 until the fraud action is finally
determined.
The Tigon group has cancelled not only the purchase transaction to which this
judgment relates, but also the original 70% purchase agreement. It seeks
restitution from the EuroPoint vendors of some 28 million Tigon shares, plus
R19 million in cash, together with interest (totalling approximately R210
million at the date of summons).
"As the EuroPoint investment is recorded at zero value in Tigon's financial
statements, there is no downside risk to Tigon's earnings arising from the
litigation," says Tigon managing director Gary Porrit. "However, a successful
judgment in the real issue of the frauds perpetrated by Varejes and Strike,
would be extremely beneficial to both Tigon's earnings and share price, bearing
in mind that over 20 million of the Tigon shares to be restored have already
been sold by the EuroPoint vendors and would have to be repurchased by them."
Ends
ISSUED FOR : Tigon Limited
CONTACT : Garry Porrit Tel : (033) 394 2854 or Sue Bennett Tel
: (011) 440 5640
FAX NO: : (033) 394 2218 or (011) 440 5642
E-MAIL : Tigon@tigonlimited.com
ISSUED BY : TISH STEWART PR ASSOCIATES
CONTACT : Tish Stewart (011) 325 4195 Cell: 082 443 6399
FAX NO : (011) 325-4199
E-MAIL : Tish@tspr.co.za
DATE : 10 May 2001
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