Friday, October 12, 2018

3 years since the take- over, of Courts and yet the leading retailer of Consumer Products is heading for a roller-coaster ride with David Issacs looking to sell the company for MUR 1 Billion. A juicy piece of business for the Issacs led consortium which only disbursed MUR 360 m and also very revealing of the true value held by BAI subsidiary back in April 2015.

Courts Mammouth is owned by Mammouth ( Mauritius) Ltd and its shareholders are : Webber Issacs David Alexander ( David Issacs) , Latitude Investments Ltd ( Robert Simon Beecham based in UK), Cohen Bruce James Rodney ( Based in UK), Sevastaki Aikaterini ( Based in UK), Elle-M Ltee ( Ashok Prakash -Sonah , based in Sutton,UK) and Ehsan Issop Fakim.

Accounts filed by the management company Mammouth Trading Co Ltd for Financial Year ending 31 March 2018, indicate a turn over of MUR 1, 642, 868, 000. The main contenders lined up for a take over are : CIM and ENL. Both of which have benefitted significantly from the controlled demolition of BAI, by the Jugnauth led government. This new twist, comes as a silver lining of the dark story and throws wide open the Pandora’s box leaving people to see facts concealed back in April 2015.

A tale, too good to last

End of 2004, following ongoing financial strains, Courts Plc, the parent company based in London is placed into administration and KPMG London as administrator invited buyers from around the world to bid for the 84% of the shares ( the remaining 16% being held by the public through the stock market). Courts Mauritius drew the interest of many investors with BAI and Rogers being the most prominent names. The BAI outbid its rivals with an offer of USD 25 m ( MUR 750 m – as per exchange rate of Nov 2005). Within a decade, the number of stores leapfrogged from 13 to 29, with the opening of Victoria Courts in Nairobi being the highlight of the new impulse. Courts had managed to churn its stores into a terrific powerhouse with its wide assembly of brands and franchises. In terms of figures, as at April 2015, the credit book of Courts was valued at over MUR 1 billion.

The Shylock of Bell-village

Here is an interesting chapter which does have its fair share of relevance . Back in 2005, the BAI overcame both the Taylors and Espitalier Noel who were jointly running Rogers, whilst being today the only rivals (CIM of Taylors v/s ENL of Espitalier Noel) in the current race to secure Courts Mammouth.
However the smartest of them all is beyond any doubt, Webber Issacs David Alexander ( David Issacs), who under 3 different ownerships, has managed to survive and retain control over the operations. Those who have worked alongside David Issacs describe a shrewd person talented enough to fool a pack of wolves into eating each other. According to sources from former management of BAI, if there is one person who has lot to hide, it is David Issacs. Interaction between directors of BAI and Courts Asia chief executive Terry O’Connor has revealed that years back, Courts Asia had expressed its wish to partner with Courts Mauritius in view of achieving a wider regional expansion. The letter intended to the shareholders of BAI and addressed through David Issacs, never reached its destination. Must be one of those legendary Jewish conundrum.

Former directors recall one of the clashes which sparked a rift between the David Issacs and the Board. It was observed that David Issacs paid commissions to himself on sourcing of goods, whereas shareholders were systematically deprived of dividend pay outs. Another major clash goes back to objection by David Issacs and Ehsan Issop Fakim on the capitalization of the credit book. Paradoxically, upon securing the ownership of Courts, the very first action by the same David Issacs and Ehsan Issop Fakim would be to hand over the Credit Book to CIM, which withdrew its offer in the bidding process. The inseparable duo sharing a bond strong enough to bring peace to the middle east, have been partners in all manoeuvres leading to the forceful scrapping of Courts Asia.

When vultures flock to feast

Courts Asia responded to the invitation for expressions of interest within 6 days ( 19th May 2015) and was officially informed on July 31st that it had been retained as preferred bidder. However, it was the government which announced that the consortium led by Mr David Isaacs had faired in the bidding exercise. In a statement to The Straits Times of Singapore back in 2015 , Courts Asia Chief Executive Terry O’Connor narrated his bitterness about having been so unfairly treated, and ousted at the 11th hour. As per his own words “There’s a lot of smokescreen here ( Mauritius) , but if you cut to the chase, it looks like the process has been completely circumvented by the minister in charge. Perhaps we’ve dodged a bullet if Mauritius is like that and treats investors this way ”
The 3 main persons involved in this exercise had been Roshi Badhain ( Minister of Financial Services & Good Governance), Dev Manraj ( Financial Secretary) and Yacoob Ramtoola, special administrator & senior partner at BDO.

Courts Asia fell prey to the vast propaganda orchestrated by the obscure forces consisting of politicians government officials, media, employees and even trade unionists who played their role to perfection. The offer from Courts Asia was portrayed as not taking into consideration social factors. David Issacs mustered the support of local suppliers and even had a petition signed by the employees endorsing his proposal ( without having the faintest of idea of its content). Roshi Badhain roped in trade unionists who were paraded during prime time news. It was all part of a psychosis spun to instill fear. In fact, we do gather from a source having been involved in analyzing the offers, that the proposal from Mammoth (Mauritius) Ltd , had to be rejected straight away on grounds of non-compliance.

Even more astonishing, the initial bid of Mammoth (Mauritius) Ltd was brought down from MUR 400 m to MUR 360 m. A discount of MUR 40 000 000 which must be somewhere in the cyberspace. The only increase has been in the number of employees fired which initially stood at 120 which later on increased to over 200 and 115 redeployed to CIM.

Questioned on this particular issue, Khushal Lobine intervening on behalf of the leader of opposition, has reiterated call, made by Xavier Duval previously in parliament, for setting up of a commission of Inquiry on the whole issue of BAI. Khushal Lobine affirms “ If the government deemed necessary to have a Commission of Inquiry on the sale of shares held by BAI in Britam Kenya, the same logic should apply to the whole of BAI.” . Kushal Lobine further questions the rationale applied in evaluating the company, “ If after such disgrace and downfall, Courts Mammouth is said to be worth 1 billion now, then what was its value at the peak of its story in 2015? Truth cannot be concealed eternally”

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