Blue Financial Services may be forced to sell up if plan fails
BLUE Financial Services will have to dispose of assets if a recapitalisation plan is not finalised soon, it said on Wednesday."The next two weeks will be crucial," CEO Johan Meiring said.The troubled unsecured lender has been in limbo since 2008 when it expanded into a number of African countries, notably Nigeria, but got into trouble with regulators when it wanted to repatriate profits to SA. This caused bad debt to spike, while the local unsecured lending market went into difficulties as the economy slowed down.A turnaround process has been in place since 2010.This was stalled in 2013 when management discovered R191m of undisclosed liabilities and a forensic report on Leonox Investments cast doubt on the 2013 audit.Leonox is a special-purpose vehicle in the Mayibuye Group. Mayibuye, a private equity group, owns 54% of Blue. Mr Meiring is also CEO of Mayibuye. Absa owns about 5% but is being sued by Blue for R70m, which Blue says it is owed. Legal action for recovery of R209m again...
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