Porritt concedes Tigon gained from fund
--------------------------------------------------------------------------------
PIETERMARITZBURG - Investment company Tigon, which has been suspended from the JSE Securities Exchange SA since the arrest of its CEO Gary Porritt in 2002, made millions from the now-bankrupt PSC Guaranteed Growth (PSCGG) fund, an insolvency inquiry heard yesterday.
Testifying at an inquiry into the Porritt-related EBN Trading, Porritt indirectly confirmed Tigon had benefited from the R250m poured into PSCGG by 4000 investors who were unaware of the fund`s deep links to Tigon.
Former PSCGG head Jack Milne is now in jail, and Porritt faces a criminal trial for defrauding the fund`s investors.
Porritt said yesterday that Tigon had transferred 209-million shares it held in another company he headed, Shawcell Telecommunications, to the fund in February 2002.
This was done to settle a debt owed by Tigon-subsidiary Synergy Management to PSCGG.
`Milne then said you have a lot of Shawcell shares, so how about giving (PSG) some of these (Shawcell) shares?` ` said Porritt.
He said a deal was done at the end of February, under which PSCGG got Shawcell shares at 55c each while Tigon got R85m.
But by February 28, Shawcell`s shares had slumped to 39c on the JSE, far less than the deal price of 55c and suggesting Tigon made millions from the deal.
In affidavits last year, Milne accused Porritt of lying, saying the deal was done in September 2002 and backdated a year.
Shawcell`s shares were trading at about 12c a share in September, which Milne said was `less than half the (55c) at which this transaction took place`.
`I would never have agreed to such a loss, but I was only told of the transaction after it happened,` he said in an affidavit.
Tigon also received R23m in fees for underwriting the fund.
Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information.
