COMPANY NEWS
Skonkwane goes under
June 20, 2003
By Wiseman Khuzwayo
Johannesburg - Skonkwane Holdings and Skonkwane Corporate have finally been put into liquidation, after denying to Business Report they were facing massive financial problems.
The order was executed two weeks ago, according to SBT Trust, the liquidators. The firms have left a trail of desperate suppliers, franchisees and staff, who are owed thousands, if not millions, of rands.
Adding to the woes was the start on Wednesday of a section 417 inquiry into DNA Skonkwane Supply Chains - a joint venture between DNA and Skonkwane Holdings.
The merged entity, formed last year to service franchised shops, was liquidated early this year after DNA accused Skonkwane of failing in its payment obligations to the joint venture.
Skonkwane Holdings was a franchise organisation, supplying materials to hardware shops.
In Gauteng 12 people who were retrenched when Bonus Building Supplies was liquidated were each granted a loan of R240 000 by the Industrial Development Corporation to buy their Skonkwane franchises.
According to the group, this money was not paid to them but was deposited into the Skonkwane bank account in Nelspruit
.
Most of the shops in Gauteng, KwaZulu-Natal, Eastern Cape and Free State opened in July last year but the problems began within a month. They had no stock as suppliers had not been paid by Skonkwane, even though money was withdrawn from the franchisees' bank accounts through their cheque books.
The cheque books were kept by the company and the account holders had not countersigned.
In April, when asked by Sunday Business Report, former Mpumalanga premier Mathews Phosa, the former chairman of the two companies and of DNA Skonkwane, denied Skonkwane Holdings and Skonkwane Corporate were in financial trouble.
Jim and Iny McSeveny, directors of Skonkwane and of the joint venture, gave evidence at the 417 inquiry. Phosa was also expected to give evidence.
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