Sascoc served with papers by former media partner
Highbury wants to force Sascoc to liquidate in order to pay its nearly R5 million debt to the company accrued since 2013
CAPE TOWN – The Embattled South African Sports Confederation and Olympic Committee (Sascoc) was served court papers by former media partner Highbury Safika Media (HSM) last Friday.
Sascoc was dealt another body blow as HSM filed a liquidation application last week as they look to recoup the R4.75 million owed to them for services rendered for the last six years.
HSM has been a media partner of Sascoc since 2009, however, in 2013 the contract was extended to include amongst other services the publication of a quarterly print magazine, management of the website and digital platforms and communication services.
HSM Director of Commercial and Legal Affairs at Highbury Tracey Stewart said instalments ended last year.
"The last payment we received was on 30 April 2018 and the reasons that were given to our collecting department where cash flow issues."
Repeating HSM Managing Director Tony Walker quotes on the breakdown of the relationship between HSM and Sascoc, Stewart talks about a botched sponsorship event.
“The relationship, from the outset in 2009, was always good until we expressed no interest in committing to a beach volleyball tournament in the Free State."
‘‘It was from then on that the payments slowed and the relationship broke down.”
It is important to note that former Sascoc CEO Tubby Reddy, who was sacked for a number of reasons, had previously served as the president of Volleyball South Africa.
HSM refused a R3 million beach volleyball sponsorship with Reddy allegedly pushing the deal but HSM could not support it because it had no links to the umbrella body.
Sascoc failed to meet their financial obligations in the last 10 months, it should be no surprise that cash flow issues were experienced as Sascoc posted a R 16 million loss in the last financial year and forked out R6m in legal fees plus their funding from the National Lotteries Commission has been slashed from R100m to R5m annually.
Added to this, Sascoc is fighting battles on several fronts, they are on a collision course with the Minister of Sport over structural changes to the organization while the drawn-out CCMA process with former CEO Tubby Reddy is far from over.
In a statement, Sascoc said it would vigorously oppose the liquidation application believe it is an abuse of the legal processes.
Sascoc also claimed the application is deliberately mischievous and intended to mislead perception that Sascoc is insolvent.
"We intend to oppose the application for liquidation of the organisation. We have been in communication with HSM since October last year and have made them aware of the review of all current supplier contracts, in line with the introspection currently underway in the organization."
"On or about the 8th December 2018 we wrote to their legal representatives to state the above and to seek a round-table meeting with them to find an amicable way forward, which they refused."
"Whilst we don’t wish to ventilate this matter in the media Sascoc is particularly concerned about the clauses in the contracts which allowed HSM the right to exercise an option to renew the contracts unilaterally, on seemingly such terms as HSM decided were equitable.
“This is an unusually advantageous clause and one which is not customarily seen in service level agreements."
The provisional court date is set for South Gauteng High Court, 12 March 2019.