While the time has come to kiss MGX goodbye, the blame game is no doubt just beginning. If you start with FRM Strategies' statement yesterday, it was the banks not coughing up the cash that led to MGX's final demise.
But can you really blame the banks?
The technology market is a dog to start with. Then there is the fact that the businesses surviving within MGX are being torn apart by competitors hungry to find extra margin in a difficult market.
Serious legal questions remain about the role former chief executive Chris Hills and chairman Ronnie Price had to play in the demise of MGX. And there was the whiff of something rotten about MGX's acquisition of CCH.
These questions came to light in the first statements about the company by Peter Flack, the turnaround specialist who served as MGX's executive chairman, when he said its operations were relatively sound but had been badly managed.
While that statement may not have engendered confidence in the firm's long-term viability, it makes Flack now look invulnerable. It shifted all blame to ex-management long before blame needed to be apportioned. A wise move on Flack's part.
Fancy footwork aside, the problems listed above would scare the most risk-loving institution, let alone banks.
Right now the banks are an easy target for some blame shifting - they have already been implicated in causing the supposedly untimely demise of Retail Apparel Group (RAG) and CNA.
But what about Price and Hills and CCH? Hopefully, MGX shareholders other than Price will insist on an inquiry, because there is more to this collapse than bad management.
And what about Flack? If he had closed the doors when Brait brought him in at the end of last year, there would arguably have been far more for distribution to stakeholders than there will be now. Eight months seems a long time to try hard, take consulting fees, espouse confidence, strategise and then walk away. RB
At a cocktail function at Cape Town's V&A Waterfront last week, Iqbal Surve, the chief executive of Sekunjalo Investments, sang the praises of Nedbank Corporate for providing funding to pay for a bigger stake in Premier Fishing.
Yet, until recently, Surve roundly criticised the fact that empowerment companies had great difficulty getting growth funding.
At the cocktail function on the top floor of Nedcor's new premises in the Clocktower precinct, John Stergianos of Nedbank Corporate jokingly said the bank had advanced the loan because its security lay in Premier's fishing fleet, and from the bank's upper floors it could keep an eye on the trawlers tied up at the quay.
In his rejoinder Mo Kajee, Premier's chief executive, said it was the one asset Premier could spirit away.
But the bonhomie does not detract from the fact that Nedcor, and other big banks, might have undergone a change of heart on the financial road to Damascus. Stergianos did say the funding reflected the bank's wish to play a bigger role in empowerment funding. Perhaps other banks will follow suit. RM
Barclays Bank, as we now know, has issued summons against Deloitte & Touche for damages suffered when it lost R25 million in unsecured loans advanced to LeisureNet while it was in the throes of its demise.
It is understood that Barclays is basing its claims on evidence led at LeisureNet's inquiry. Earlier this year the inquiry travelled to London to take evidence on commission. It is understood the bank did not bend over backwards to assist the commission, yet now seeks to use the evidence unearthed by the liquidators and their legal team to support its claim.
Further, when Business Report last Friday first became aware that summons had been issued and inquired after this, a bank employee in the legal department flatly denied litigation had been initiated. It was only later that day that the public relations manager confirmed the fact. No other comment could be obtained.
Surely it is a matter of compelling public interest to make all relevant information known? After all, other investors who lost money might just be spurred to pursue their own claims. RM
No news of the discussions between the RAG liquidators and creditors, although some sort of settlement was expected early last week.
In contrast to what has been quite a leaky process to date, it seems all parties are adhering to a commitment not to make public announcements until something has been agreed on; or presumably until discussions look as though they're coming off the rails.
The extent to which banks, led by First National Bank (FNB), are ready to relinquish some claims in favour of trade creditors, the receiver of revenue and labour will be crucial to negotiations.
Almost as significant will be the desire by the parties involved not to lose face or at least not to appear to lose face.
At this stage FNB appears to have lost almost as much money as face. The bank will be keen to secure a settlement so the RAG story can be removed from the headlines and the liquidation process finalised. But it will also be keen not to give up too much to secure this outcome, or to be seen to be prepared to give up too much. On the other side, the lead liquidators will probably be keen to emerge looking like something as close to heroes as possible.
So in a process in which there really are no winners, it is likely all sides will be claiming victory if a settlement is secured. AC