Choppies’ Ram takes 43% salary Chop
The Chief Executive Officer of Choppies Group, Mr Ramachandran Ottapathu has a new employment Contract as Chief Executive Officer – and it his pay cheque is down 43%. The employment contract of Mr Ottapathu was reviewed following advices from Advocates Hoffmann SC and Redding SC hance ‘appropriate clauses inserted in the employment contract’.
According to a Choppies circular, “In accordance with current best remuneration practises as advocated by King IV Code on Corporate Governance, the current guaranteed portion of the Chief Executive Officer’s remuneration has been reduced by 43% to facilitate the introduction of short-term incentives.”
The circular, released this week, states that upon the lifting of the suspension of the Company’s share trading on the BSEL and JSE, the Board will consider the introduction of long-term incentives as part of the remuneration of the Chief Executive Officer as well as the quantum of overall remuneration. The reviewed employment contract between the Company, and the Chief Executive Officer was effective as of 1 March 2020.
In addition Choppies has appointed a Chief Financial Officer. A South African Chartered Accountant has been appointed CFO with effect from mid-April 2020. This appointment is subject to the issuing of a work permit by the Botswana authorities. “The individual has extensive JSE listed company experience including group accountant of the Nampak Group for six years and more recently senior financial positions within the retail group Edcon.”
Furthermore the Group has recruited a Deputy Chief Executive Officer. According to the circular, a suitable candidate with over 25 years of grocery retail experience in Southern Africa including very senior executive position and proven retail track record has been identified and he will commence duties with the Group, as soon as his current commitment comes to an end, during April 2020.
Loans and injection of capital by founding shareholders
As of 19 September 2019 loans of an aggregate of approximately BWP680million were outstanding to the Lenders. According to Choppies, in terms of a facility agreement concluded between the Company and CDC and certain of the Lenders, the capital of majority of loans was repayable, over a 5-year period of time, commencing 1 July 2020, with interest payable on a monthly basis.
“Because of various instances of default, the main instance of which was failure to timeously deliver and publish the audited consolidated financial statements in respect of the year ended 30 June 2018, the principal balances of or the borrowings, became payable in full, on demand.”
The circular notes that the Lenders agreed to hold off making demand for immediate payment and proceeding to recover the full amount of the aggregate of the capital of the borrowings provided that there be an immediate reduction in the capital outstanding of the loans and sales of non-performing businesses of the Group, particularly those in South Africa, be proceeded with, with an agreed time frame.
“The Company agreed to a reduction of the capital of loans in the sum of BWP150million payable as to (1) the amount of BWP 100million by 10 October 2019 and (2) BWP 50million by 30 November 2019, and required that the Founding Shareholders guarantee the payment by the Company of the total aggregate of BWP 150million, on the due dates.” The Choppies Founding Shareholders have agreed to undertake that guarantee and as of the 10th of October 2019, the Company was not able to effect the reduction of capital of the loans outstanding to the Lenders in the sum of BWP 100million.
Accordingly, in terms of the guarantees, the Founding Shareholders effected the payment of BWP100million, Mr Ottapathu effecting a payment of BWP 80 million and Mr Ismail effecting a payment of BWP20million thereof to the agent for the Lenders, thereby causing the outstanding capital balance of the loans due to the Lenders to be reduced by the required BWP 100million, reads the circular.
“The Company and the Founding Shareholders agreed that, subject to compliance by the Company of the requirements of the BSEL, as set forth in the BSE Equity Listing Requirements for a related party transaction based on the size of the contribution made by the Founding Shareholders relative to the size of the Company, the payment of BWP 100million by the Founding Shareholders on behalf of the Company, to the Lenders, in reduction of the capital outstanding to the Lenders, would be considered a loan by them to the Company on the basis that:- such loan would accrue interest at a rate, comparable to current market related rates of interest; the claims of the Founding Shareholders for repayment of the capital of the loan be subordinated to the claims of the Lenders and trade creditors of the Group,” the circular reads.
They further agreed that the capital of the loan will be repayable provided that: a debt reduction plan in respect of the capital outstanding to Lenders has been approved by the Lenders; the Company and CDC are in compliance with the terms of the debt reduction plan including all debt reduction milestones; there is no default by the Company or CDC under facility agreements with the Lenders and the terms of securities granted in favour of the Lenders; no payments of interest or capital are outstanding to Lenders; neither the Company nor CDC are in arrears with any amount due and payable to Lenders; A repayment under the loan can be made from free cash flows which, in this context mean the net cash of the Company and CDC available for distribution after making provision for amounts due to Lenders and trade creditors.
The BSEL has confirmed that the contribution by the Founding Shareholders on behalf of the Company, in reduction of the capital outstanding to the Lenders may be considered a loan, by the Founding Shareholders, and a loan agreement in this regard entered into by the Company and the Founding Shareholders as related parties to the Company, provided that there be an independent professional expert opinion in respect of the fairness and reasonableness of the terms of the loan.
The second instalment in reduction of the outstanding capital of the loans (that of BWP 50million which was due and payable on the 30 November 2019) was paid, in two tranches (with the approval of the Lenders) of BWP 20million on 20 December 2019 and BWP 30million on 14 January 2020, from the resources of the Group generated over the 2019/2020 festive season. The Company and the Lenders are in advanced discussions to agree on a Debt Reduction Plan which is expected to be finalised by the 31 March 2020.
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Nigerians, Zimbabweans apply for Chema Chema Fund
Fronting activities, where locals are used as a front for foreign-owned businesses, have been a long-standing issue in Botswana. These activities not only undermine the government’s efforts to promote local businesses but also deprive Batswana of opportunities for economic empowerment, officials say. The Ministry of Trade and Industry has warned of heavy penalties for those involved in fronting activities especially in relation to the latest popular government initiative dubbed Chema Chema.
According to the Ministry, the Industrial Development Act of 2019 clearly outlines the consequences of engaging in fronting activities. The fines of up to P50,000 for first-time offenders and P20,000 plus a two-year jail term for repeat offenders send a strong message that the government is serious about cracking down on this illegal practice. These penalties are meant to deter individuals from participating in fronting activities and to protect the integrity of local industries.
“It is disheartening to hear reports of collaboration between foreigners and locals to exploit government initiatives such as the Chema Chema Fund. This fund, administered by CEDA and LEA, is meant to support informal traders and low-income earners in Botswana. However, when fronting activities come into play, the intended beneficiaries are sidelined, and the funds are misused for personal gain.” It has been discovered that foreign nationals predominantly of Zimbabwean and Nigerian origin use unsuspecting Batswana to attempt to access the Chema Chema Fund. It is understood that they approach these Batswana under the guise of drafting business plans for them or simply coming up with ‘bankable business ideas that qualify for Chema Chema.’
Observers say the Chema Chema Fund has the potential to uplift the lives of many Batswana who are struggling to make ends meet. They argue that it is crucial that these funds are used for their intended purpose and not siphoned off through illegal activities such as fronting. The Ministry says the warning it issued serves as a reminder to all stakeholders involved in the administration of these funds to ensure transparency and accountability in their disbursement.
One local commentator said it is important to highlight the impact of fronting activities on the local economy and the livelihoods of Batswana. He said by using locals as a front for foreign-owned businesses, opportunities for local entrepreneurs are stifled, and the economic empowerment of Batswana is hindered. The Ministry’s warning of heavy penalties is a call to action for all stakeholders to work together to eliminate fronting activities and promote a level playing field for local businesses.
Meanwhile, the Ministry of Trade and Industry’s warning of heavy penalties for fronting activities is a necessary step to protect the integrity of local industries and promote economic empowerment for Batswana. “It is imperative that all stakeholders comply with regulations and work towards a transparent and accountable business environment. By upholding the law and cracking down on illegal activities, we can ensure a fair and prosperous future for all Batswana.”
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Merck Foundation and African First Ladies mark World Health Day 2024
Merck Foundation, the philanthropic arm of Merck KGaA Germany marks “World Health Day” 2024 together with Africa’s First Ladies who are also Ambassadors of MerckFoundation “More Than a Mother” Campaign through their Scholarship and Capacity Building Program. Senator, Dr. Rasha Kelej, CEO of Merck Foundation emphasized, “At Merck Foundation, we mark World Health Day every single day of the year over the past 12 years, by building healthcare capacity and transforming patient care across Africa, Asia and beyond.
I am proud to share that Merck Foundation has provided over 1740 scholarships to aspiring young doctors from 52 countries, in 44 critical and underserved medical specialties such as Oncology, Diabetes, Preventative Cardiovascular Medicine, Endocrinology, Sexual and Reproductive Medicine, Acute Medicine, Respiratory Medicine, Embryology & Fertility specialty, Gastroenterology, Dermatology, Psychiatry, Emergency and Resuscitation Medicine, Critical Care, Pediatric Emergency Medicine, Neonatal Medicine, Advanced Surgical Practice, Pain Management, General Surgery, Clinical Microbiology and infectious diseases, Internal Medicine, Trauma & Orthopedics, Neurosurgery, Neurology, Cardiology, Stroke Medicine, Care of the Older Person, Family Medicine, Pediatrics and Child Health, Obesity & Weight Management, Women’s Health, Biotechnology in ART and many more”.
As per the available data, Africa has only 34.6% of the required doctors, nurses, and midwives. It is projected that by 2030, Africa would need additional 6.1 million doctors, nurses, and midwives*. “For Example, before the start of the Merck Foundation programs in 2012; there was not a single Oncologist, Fertility or Reproductive care specialists, Diabetologist, Respiratory or ICU specialist in many countries such as The Gambia, Liberia, Sierra Leone, Central African Republic, Guinea, Burundi, Niger, Chad, Ethiopia, Namibia among others. We are certainly creating historic legacy in Africa, and also beyond. Together with our partners like Africa’s First Ladies, Ministries of Health, Gender, Education and Communication, we are impacting the lives of people in the most disadvantaged communities in Africa and beyond.”, added Senator Dr. Kelej. Merck Foundation works closely with their Ambassadors, the African First Ladies and local partners such as; Ministries of Health, Education, Information & Communication, Gender, Academia, Research Institutions, Media and Art in building healthcare capacity and addressing health, social & economic challenges in developing countries and under-served communities. “I strongly believe that training healthcare providers and building professional healthcare capacity is the right strategy to improve access to equitable and quality at health care in Africa.
Therefore, I am happy to announce the Call for Applications for 2024 Scholarships for young doctors with special focus on female doctors for our online one-year diploma and two year master degree in 44 critical and underserved medical specialties, which includes both Online Diploma programs and On-Site Fellowship and clinical training programs. The applications are invited through the Office of our Ambassadors and long-term partners, The First Ladies of Africa and Ministry of Health of each country.” shared Dr . Kelej. “Our aim is to improve the overall health and wellbeing of people by building healthcare capacity across Africa, Asia and other developing countries. We are strongly committed to transforming patientcare landscape through our scholarships program”, concluded Senator Kelej.
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Interpol fugitive escapes from Botswana
John Isaak Ndovi, a Tanzanian national embroiled in controversy and pursued under a red notice by the International Criminal Police Organization (Interpol), has mysteriously vanished, bypassing a scheduled bail hearing at the Extension 2 Magistrate Court in Gaborone. Previously apprehended by Botswana law enforcement at the Tlokweng border post several months earlier, his escape has ignited serious concerns.
Accused of pilfering assets worth in excess of P1 million, an amount translating to roughly 30,000 Omani Riyals, Ndovi has become a figure of paramount interest, especially to the authorities in the Sultanate of Oman, nestled in the far reaches of Asia.
The unsettling news of his disappearance surfaced following his failure to present himself at the Extension 2 Magistrate Court the preceding week. Speculation abounds that Ndovi may have sought refuge in South Africa in a bid to elude capture, prompting a widespread mobilization of law enforcement agencies to ascertain his current location.
In an official communiqué, Detective Senior Assistant Police Commissioner Selebatso Mokgosi of Interpol Gaborone disclosed Ndovi’s apprehension last September at the Tlokweng border, a capture made possible through the vigilant issuance of the Interpol red notice.
At 36, Ndovi is implicated in a case of alleged home invasion in Oman. Despite the non-existence of an extradition treaty between Botswana and Oman, Nomsa Moatswi, the Director of the Directorate of Public Prosecution (DPP), emphasized that the lack of formal extradition agreements does not hinder her office’s ability to entertain extradition requests. She highlighted the adoption of international cooperation norms, advocating for collaboration through the lenses of international comity and reciprocity.
Moatswi disclosed the intensified effort by law enforcement to locate Ndovi following his no-show in court, and pointed to Botswana’s track record of extraditing two international fugitives from France and Zimbabwe in the previous year as evidence of the country’s relentless pursuit of legal integrity.
When probed about the potential implications of Ndovi’s case on Botswana’s forthcoming evaluation by the Financial Action Task Force (FATF), Moatswi reserved her speculations. She acknowledged the criticality of steering clear of blacklisting, suggesting that this singular case is unlikely to feature prominently in the FATF’s assessment criteria.