Iqbal Survé & Co reap more Ayo ‘profits’

Iqbal Survé
Iqbal Survé

PIC cash funds another R120m in dividends for Survé-controlled parent company

Ayo Technology Solutions, the company tied to mogul Iqbal Survé, that controversially received R4.3 billion from the Public Investment Corporation (PIC), will dramatically hike its dividends even though profits are still mostly derived from interest on the PIC’s cash.

Ayo release interim financial results this week covering the six months from September to the end of February this year. The results were positive with profit before tax of R266 million.

About 58% of that was seemingly interest on the R4.3 billion from the PIC – R155 million.

At the same time Ayo has announced that it will pay out about R120 million in dividends – mostly to parent company African Equity Empowerment Investments (AEEI), a company controlled by Survé’s company Sekunjalo.

This payout is a sharp increase on the dividend Ayo declared for the full year last year.

City Press has previously reported how Ayo’s profits last year were entirely derived from interest on the PIC cash it had kept largely in the bank. A R100 million dividend was nevertheless paid out for a period of 12 months.

Now it is R120 million for six months.

City Press broke the news last year that Ayo had, almost immediately after receiving the PIC money, invested more than R400 million of it at an asset manager controlled by Survé, 3 Laws Capital.

The new results show this money has now been moved to a different asset manager, Oasis.

Ayo’s results were not entirely related to the giant cash pile it got from the PIC.

In September last year Ayo made its first substantial acquisition using the PIC money. It bought 55% of Sizwe Africa IT in a strange deal that came out of the blue to undercut a pre-exsting and very advanced bid by a smaller black-owned company funded by the Industrial Development Corporation (IDC) to make exactly the same acquisition.

The IDC told City Press earlier this year that the Ayo deal was a complete surprise as there was already a sale and purchase agreement signed. The funder heard its deal was scuppered when Ayo publically announced its own deal.

The Sizwe acquisition seemingly came about due to a serious conflict of interest for the ANC’s chaplain-general Vukile Mehana.

He was chairperson of Mustek, the company owning 40% of Sizwe which was negotiating with the IDC group.

He was simultaneously the chairperson of AEEI, Ayo’s parent company, which has allegedly interfered extensively in the company’s affairs.

Mehana was one of the shareholders being bought out by Ayo and made millions from the deal.

It is reasonable to assume he helped Ayo swoop in to “steal” the deal at a slightly better price. He and Mustek have refused to answer questions on the matter.

This week’s results show the contribution this acquisition has made. Sizwe Africa contributed R212 million to Ayo’s revenue in only two and a half months – about a third of Ayo’s total revenue for the entire six months.


Ayo’s results remain overshadowed by the risk that the PIC will, as it promised to do, fight to get its R4.3 billion back.

There has been some confusion about the PIC’s intention to do this because the asset manager went to court to scrap an initial directive from the Companies and Intellectual Property Commission (CIPC).

The PIC, however, said it was in fact going to recover its R4.3 billion through other means because the CIPC directive was flawed.

Ayo could technically pay the PIC back, but that would almost wipe out the company’s entire asset base.

In this week’s results the remaining cashin Ayo’s bank account was R3.6 billion with another R525 million invested at fund managers, which can be used at short notice.

That leaves it R200 million short before the PIC factors in interest, which it said it would do.

Further acquisitions by Ayo include 50% of the Vunani Group, which was renamed Bambelela in March, for R145 million equity and R100 million in debt.

Ayo has in February this year bought 40% of another company, SAAB Grintek Technologies, without disclosing the price.

Yet more friendly Ayo traders

Since May last year almost all the investors who have bought Ayo shares were either Survé himself, his family or long-time associates.

City Press has been keeping tabs on the trading of Ayo shares for several months using JSE data.

This trend continued and actually accelerated last month despite the Financial Sector Conduct Authority announcing that Ayo was one of the companies it was investigating for possible share manipulation.

In March the biggest buyer of Ayo shares was Lieb Johannes Loots, one of the original directors of Sekunjalo in 1999 who left the board in 2009.

A number of other former directors of Sekunjalo have been among the few buyers of Ayo shares the past year.

Loots is now the third-largest buyer of Ayo shares after Sekunjalo, which is controlled by Survé and indirectly controls Ayo, and Survé’s financial services company 3 Laws Capital.

By now Survé has spent several million rands on Ayo shares, which were trading at R15 this week compared with the R43 a share the PIC controversially paid in December 2017.

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