ANCYL sounds the debt bells

2010-05-16 10:57

The front company of the ANC Youth League (ANCYL), Lembede

Investment Holdings, has closed its operations amid growing debts, City Press

has established.

Lembede has abandoned its R25 000-a-month offices in Sandton

Towers, north of Johannesburg. The landlord, Liberty Property Group, is taking

the company to court.

Liberty is one of many companies that Lembede has failed to pay for

supplying services and goods in the past few years. Lembede’s debts to creditors

total more than R14 million.

However, a City Press exposé two weeks ago revealed a scheme

whereby Lembede directors, including youth league leaders, would take 30% of all

deals the company signed during their term.

Among the deals is a lucrative printing contract for the entire

Limpopo provincial government.

Ali Boshielo, a chief operating officer of Lembede and close ally

of youth league president Julius Malema, took over the printing deal by buying

80% of Review Printers just two months before the ­contract was signed. The

contract is worth R10 million and expires in March.

A source said Boshielo’s action “demonstrates the extent to which

individuals are enriching themselves under Lembede”.

Meanwhile, Lembede still owes for services rendered for the

league’s functions and conferences held over the years, including the April 2008

Kimberley elective meeting where Malema was named president.

City Press has found that most creditors have not approached the

courts to demand their money for fear that they could jeopardise future chances

of getting work from government.

The youth league announced its plans to close Lembede after it

received recommendations from a team investigating the firm’s operations.

Announcing the closure on Thursday, the league said: “We accepted a

recommendation that Lembede should be closed to ­settle creditors and thereafter

pay the ­residue to its shareholders as a liquidation dividend. The

implementation of the resolution should be that the assets of Lembede should be

sold through (an) ­unsolicited bid process that must be ­implemented

simultaneously with the ­voluntary liquidation process.”

League spokesperson Floyd Shivambu did not respond to

questions.

Liberty applied for a default judgment for non-payment of office

space after ­Lembede failed to respond to a summons served in February.

If the judgment is granted, Lembede will have to pay Liberty the

remainder of the lease agreement which runs until August 2011. At R25 000 a

month for 183 square metres, Lembede will be forced to be pay Liberty about

R450 000 should it decide to cancel the lease.

Two reliable sources who are familiar with Lembede said the company

owed its former chief executive, Lonwabo Sambudla, whose contract was terminated

eight months before it expired last July, salary cheques for several

months.

Lembede lawyers have also not been paid while a firm owned by

former league ­member and now Congress of the ­People member Andile Nkuhlu was

owed half of the dividends paid out of a joint venture mining deal with the

league’s company.

Nghala Mining, of which Lembede ­Resources owns 10%, paid dividends

of R391 000 to Lembede between 2006 and 2008. But the league’s company used the

money for league activities.

Lembede Resources is half-owned by Lembede Investment. The other

half ­belongs to Nkuhlu and the former Lembede chief executive, Songezo

Mjongile.


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