Nova’s dubious windfall
ROB ROSE: Top brass mopping up Sharemax debris stand to score stock worth R946m — for free
It’s the sort of distasteful get-rich-quick scheme that gives capitalism a bad name
It’s the sort of distasteful get-rich-quick scheme that gives capitalism a bad name. Seven founding shareholders, including four directors, who scored 95.7% of the Nova Property Group without paying a cent, now stand to become proud owners of a stake worth about R946m — if the company gets the green light to list on the JSE in a few weeks. What makes this so especially disturbing is that Nova is the successor to the failed Sharemax property syndication scheme, which sapped R5bn from more than 33,000 investors — many of them financially unsavvy pensioners — until it hit the wall in 2010. Back then, the Reserve Bank found that Sharemax’s funding model was "in contravention of the Banks Act", so it ordered a widescale "restructuring".