INLSA
President Jacob Zumas homestead at KwaNxamalala, Nkandla in KwaZulu-Natal. Picture: Bongiwe Mchunu
KwaZulu-Natal – The main contractor upgrading President Jacob Zuma’s Nkandla home has escaped liquidation, but has left a string of KwaZulu-Natal subcontractors with empty pockets.
Bonelena Construction, Enterprise and Projects, which had two major deals worth almost R100 million linked to the multimillion Nkandla upgrade, avoided liquidation in February after creditors were forced to accept a revised payment arrangement in an out-of-court settlement.
A total of 23 subcontractors, owed more than R5m, accepted the offer of 50 percent payment for their work.
Had these “concurrent creditors” not accepted, Bonelena would have been liquidated and they would have been paid nothing.
Bonelena, which is owned by Pietermaritzburg businesswoman Thandeka Nene, has until the middle of this month to effect payment. The Industrial Development Corporation (IDC) also gave Bonelena R10m for the repayment of creditors, despite already being owed R19.7m.
Subcontractors who spoke to The Mercury on condition of anonymity said Bonelena had not been paid by the Department of Public Works, hence its inability to pay them.
Some said they would still do business with Nene as she had always been a reliable client.
“We will now be taking more precautions when it comes to getting guarantees for payment from clients, like personal sureties…
“We have done a lot of business with Bonelena. Thandeka is a very nice lady who has kept in touch with us by e-mail and always paid,” said a Pietermaritzburg building materials supplier.
However, another subcontractor said although Bonelena’s financial struggle was due to the department’s not paying, he would not do business with the company again.
Some subcontractors have been hit harder than others, with a few admitting the loss of income from the contract had affected their business.
They said the liquidator’s report said Bonelena had failed to keep proper accounts, so the liquidator had been unable to establish its financial position.
Court documents revealed that Bonelena’s R8.2m worth of assets would only fetch R6.4m on forced sale.
Secured creditors such as Absa, Standard Bank, First National Bank, Wesbank, Sars and company employees would receive all or most of the R8.2m that was owed to them. The Industrial Development Corporation, which was owed R19.7m before Bonelena applied for liquidation, bailed the company out by granting it a further R10m to pay creditors. Of the initial amount, the IDC is a secured creditor for R11.5m, but will only receive 50 percent of R8.2m, the portion which falls under “concurrent creditor”.
IDC spokesman Mandla Mpangase did not reply to questions.
Nene could not be reached yesterday for comment. However, she said on previous occasions that the department owed her company R8m.
Public Works Ministry spokesman Sabelo Mani could not be reached for comment. He has in the past been quoted as saying he could not divulge information on Nkandla as it was a national key point.
The Mercury
