News report on Durban Point Development Company deal contains price-sensitive information

Pretoria - Trade on the shares of Bonatla Property Holdings was suspended on the JSE yesterday after the disclosure of details about its acquisition of a stake in the Durban Point Development Company (DPDC).

A cloud of suspicion was cast over the development after it was revealed at the trial of jailed businessman Schabir Shaik that he allegedly tried to use the influence of former deputy president Jacob Zuma to secure the involvement of his Nkobi group in the project.

An announcement placed yesterday on the JSE news service Sens by Vunani Corporate Finance said the Business Day article on the proposed DPDC transaction contained price-sensitive information.

Because no official announcement had yet been released relating to the transaction, the JSE decided to halt trading in Bonatla shares until the firm made an announcement, it said.

The Sens announcement added that although an agreement had been signed with Renong Overseas Corporation related to a deal at DPDC, the agreement had not been finalised.

The article said that the deal would result in Bonatla buying half the shares in the DPDC for R150 million, which would allow Malaysian company Renong to withdraw from South Africa. It added that the deal was structured in a way that cut out Renong's local empowerment partner, Vulindlela Investments.

The alleged intervention by Zuma on Shaik's behalf in the redevelopment of Durban's Point area, which had also attracted the interest of Renong, was mentioned in Shaik's criminal trial.

Evidence in this regard, according to Judge Hilary Squires, was contained in the first of two affidavits by David Wilson, the head of Renong's foreign operations arm.

Wilson said in the affidavit that a meeting with Zuma, arranged by Shaik, took place in February 1997. During the meeting Zuma said he was not happy with the persons nominated to represent the empowerment interest in DPDC and suggested that Shaik be included, while stressing that Shaik would be a good partner for the project.

Wilson said that while Renong had no wish to be involved in a dispute about the selection of empowerment partners, as that was a matter for the government, he would continue with the existing partners unless told by the government to change.

However, Judge Squires said the southeast Asia currency crisis broke shortly after another meeting between Wilson and Shaik in February 1997 and Renong put its local projects into abeyance to return to its homeland.

Nicki Vontas, consultant to CDA Property Consultants, the asset managers of Bonatla, said an announcement about the deal would be submitted for approval to the JSE "first thing" today.

With acknowledgements to Roy Cokayne and Business Report.