JSE-LISTED AYO Technology Solutions said on Friday that subsequent to Thursday’s court proceedings, the company had received positive feedback from some banking institutions indicating a willingness to engage with AYO.
The black-owned tech firm said in a statement that it would be finalising these engagments over the next few weeks. This after the AYO board met on Friday to consider the outcome of its urgent High Court interdict against FNB, which the court deemed not urgent.
“AYO had not fully exhausted its options with other banks, notwithstanding AYO’s testimony that the Company was still awaiting feedback from some banking institutions and that not all banks operating in the country offer the suite of services that AYO requires.;
“It was suggested that AYO could use third party accounts such as Trust accounts and other 3rd party payment mechanisms, (suggested by FNB), in order to pay its suppliers and employees as an interim measure. A further suggestion out of the court proceedings is that AYO advances bridging loans to employees.
“AYO’s Board has considered the above and mandated the management team to implement a seven-point plan of action to ensure the sustainability of the business over the next few months,” the company said.
AYO further said it was in the process of appointing an independent legal expert, to review the report of the Mpati Commission of Inquiry, to assess the findings in relation to AYO and where necessary make recommendations to AYO.
“Such appointee will be a retired judge and/or retired senior advocate, that has no current or previous links with AYO, has not been employed by AYO, nor has any other direct or indirect connection to AYO. AYO and its Board will extend the appointed legal expert full access to all AYO documentation leading up to the investment by the Public Investment Corporation (PIC) including all emails, correspondence, Board meetings minutes, and any other relevant records.
“AYO will announce the appointment of such person and the terms of reference for the appointment within the next few weeks. AYO has every intention to publish such a report and make it available to its stakeholders,” the company said.
The company said it would also escalate the mediation process with the PIC to reach an amicable solution and develop a positive investor-investee relationship with the asset manager.
“AYO has already engaged in a mediation process with the PIC as AYO is of the view that a protracted legal dispute is not in the interest of the PIC, AYO or its employees. Management will endeavour to accelerate this engagement in an effort to reach a speedy and amicable resolution.
“The Board is deeply perturbed by FNB’s reliance on the report of the Mpati Commission as well as the JSE fine issued to AYO in 2020, as a basis to close the Company’s bank account. AYO again asserts that the Mpati Commission was not a court of law.
“With regard to the JSE fine, it related to preliminary (unaudited) results that were non-compliant with certain IFRS requirements. While AYO believes that the sancture was disproportionate in severity to the seriousness of the reporting errors found, the accounting errors were not fraudulent but rather differences in interpretation of IFRS Standards.
“AYO wishes to note and point out certain misconstrued facts in relation to the Sekunjalo Group. African Equity Empowerment Investments (AEEI), which is a subsidiary of Sekunjalo Investment Holdings, owns 49.33 percent of AYO. It has only two representatives out of 12 directors on the AYO Board.
“AYO is therefore not a subsidiary of the Sekunjalo Group and AYO is not controlled by the Sekunjalo Group. Whilst the Sekunjalo Group is one of the largest black economic groupings committed to economic empowerment, AYO’s role is to set the record straight and not to cast aspersion on the Sekunjalo Group,” reads the company’s statement.
The board said it was of the view that AYO might be faced with a targeted campaign, despite AYO having co-operated fully with all regulators including the JSE, CIPC, the Mpati Commission, and others.
“If AYO has made mistakes, these were mistakes of omission and when brought to AYO’s attention, processes, governance and teams were strengthened so that such mistakes would not and have not recurred,” the company said.
Investigations Unit – investigations@inl.co.za