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COMPANIES TRIBUNAL

REPUBLIC OF SOUTH AFRICA.

   CASE NUMBER: CT017NOV2017

In the Ex-parte Application of:

ZONWABISE RESORT HOLDINGS LTD                                                          APPLICANT

Registration No: 1996/010774/06

Re: Application for a six months extension of the period by which the AGM of the applicant should be held

DECISION

Introduction

1. The applicant is Zonwabise Resort Holdings Ltd, a non-listed public company registered in terms of the company laws of South Africa.

2. Applicant is applying for an extension of the period for holding the annual general meeting(AGM) by six months from 2 March 2018 being the last date by which this AGM ought to be held.

3. The applicant’s last AGM was held on 2 December 2016. Section 61 (7) of the Companies Act 71 of 2008 (the Act) requires a public company to convene an AGM once every calendar year but not more than fifteen (15) months after the date of the previous AGM, thus the next AGM is due by 2 March 2018.

4. The application is made mainly on the grounds of commercial convenience and practicality.

Relevant statutory framework in respect of AGM of a Public Company

5. Sections 61(7) of the Companies Act 71 of 2008(the Act) prescribes the timeframes for convening AGMs and entitles the Companies Tribunal(the Tribunal) to, on good cause shown, grant a company the indulgence to hold the AGM outside the prescribed periods.

6. Section 61(8) of the Act prescribes the minimum agenda items for the AGM. Amongst others, Secton 61(8)(a)(ii) requires the audited financial statements for the immediately preceding financial year to be presented at the AGM for consideration.

7. Section 29(5)(b) of the Act requires financial reporting standards for public companies, to be in accordance with the International Financial Reporting Standards of the International Accounting Standards Board or its successor body.

The evidence

8. Applicant is a Shareholder in several companies including Emfuleni Resorts (Pty) Ltd (Emfuleni) and Main Street 704 (Pty) Ltd (Main Street 704). Afrisun Leisure Pty Ltd (Afrisun Leisure) holds a considerable amount of shares in the applicant. The applicant and all three mentioned companies have a direct or indirect shareholding relationship with some of the Sun International businesses.

9. Sun International, Emfuleni, Main Street 704 and Afrisun respectively, changed their financial year end from 30 June to 31 December before 2017. The applicant’s financial year end was 30 June until 2017. After the 30 June 2017, applicant changed its year end to 31 December in order to align applicant’s financial year end with those of the companies in which applicant has significant business interests especially the four companies mentioned above. 

10. This recent change of applicant’s end of financial year makes it necessary for it to hold the AGM’s for the periods ending 30 June 2017(which is due by 2 March 2018) and 31 December 2017 respectively. Unless granted the indulgence by the tribunal in respect of the present application, applicant may be forced to hold two AGMs within six months of each other.

11. It is in the context of these circumstances that the applicant has launched this application.

Grounds of the application

12. Applicant is required to incorporate the results of its associated investments in its financial statements and the auditors can only complete auditing the annual financial statements once they are satisfied with the associates’ results. Based on the fact that the financial year end for the mentioned associates is 31 December, the applicant submits that it will not be possible to obtain the associates’ results and have the applicant’s audit completed before March 2018.

13. The applicant would like to hold one AGM for the financial periods ending 30 June 2017 and 31 December 2017 in order to save costs of having two AGM’s within 6 months of each other and also for the convenience of shareholders.

Conclusion

14. Having considered the papers before me I am satisfied that the applicant has showed good cause for the relief sought in that:

15. It makes business sense to consider mitigating expenses occasioned by statutory compliance in the circumstances of this case; 

16. It makes business sense to consider the convenience of the shareholders in the present circumstances;

17. The financial year of mentioned associates ending on 31 December makes it highly unlikely for the associates’ audit results to be out before March 2018.

18. The applicant’s change of the financial year end by aligning it with its associates’ financial year ends reduces the current problem to a once-off problem.

Accordingly the applicant is entitled to the relief sought.

Order

a.    The application for extension of the holding of the annual general meeting within six months from 2 March 2018 is granted;

b.    The applicant is authorised to hold the annual general meeting which was due by 2 March 2018 by not later than 2 September 2018.

 

Dated at Pretoria on this the 26^th day of January 2018

 

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Ms M Ramagaga

Member of Companies Tribunal

 

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