For failing to publish its 2024 annual report. From Moneyweb.
The JSE suspended trading in Ayo Technology Solutions on Wednesday (26 February) for failing to publish its annual report for the year to August 2024.
This is the latest blow to the tech firm, which is part of Iqbal Survé’s Sekunjalo group, majority owner of Independent Media and African Equity Empowerment Investments.
The company’s shares have dropped to 40c, down 99% from the peak of R45 in 2017.
“We regret to inform stakeholders of our suspension, but wish to assure the market that we remain committed to transparency and engagement with all our stakeholders, including the regulator and our valued shareholders,” said Ayo CEO Amit Makan in a statement.
“I believe we have done everything within our power to ensure compliance with the Listings Requirements, however, the release of our results is contingent on the external quality reviewer, the independence and process of which we respect.”
When it rains, it pours
It’s been a rocky few months for Ayo, which is defending a winding up application in the Western Cape High Court brought by a minority shareholder.
Joint external auditor Thawt Inc resigned in October 2024, resulting in delays in completing the annual results.
And a new CFO had to be found following the resignation of Pride Guzha in November last year.
Valentine Dzvova was appointed as the new CFO in December.
Further delays were caused by the need for an external quality review process “which necessitates additional time for thoroughness and quality assurances, which our auditors, Crowe JHB Inc, are committed to completing,” said Ayo in a Sens update.
Winding up application
In January a notice of motion was lodged with the Western Cape High Court by minority shareholder Howard Lowenthal seeking the winding up of Ayo – reportedly for poor management and shareholder depletion.
Lowenthal owns 0.13% of the company.
Ayo said it was considering legal action against the applicant for defamation and damages arising from this ‘unwarranted’ attack on the company’s reputation.
“Ayo categorically rejects the claims made in [Lowenthal’s] Notice of Motion, which it views as unfounded, opportunistic, and entirely devoid of merit. The application appears to be a deliberate attempt to harm Ayo’s reputation, manipulate public perception, and extract undue financial benefit from the company,” said the company in response.
PIC scandal
In June last year Ayo agreed to repay R619 million to the Public Investment Corporation (PIC), which had invested R4.3 billion for a 29% share in the company prior to its listing in 2017.
The settlement with the PIC and the Government Employees’ Pension Fund (GEPF) averted a court showdown where it was alleged Ayo had made misrepresentations in its pre-listing statement.
This controversial deal has dogged both Ayo and the PIC, earning a sharp rebuke from the Mpati Commission, which found the PIC flouted internal governance procedures in approving the investment.
According to News24, Lowenthal’s case in the high court claims this deal prejudices other shareholders in that Ayo agreed to buy back a portion of the GEPF’s shares at R36 each when the market price was R4.70.
In terms of the settlement, the PIC retains 25% of a company that now has a market cap of around R130 million.
In a Sens statement published in August last year, Ayo said the loss after tax for the year was R234.8 million, with the focus in the forthcoming period shifting to strengthening underlying investments and improving margins.
It also said it was engaging with the PIC to ensure continued support for its vision.
