Pay-TV licensee Super 5 Media has finally admitted publicly that it is facing big problems.
But newly appointed director Muhammad Lockhat says the company is still working to get a pay-TV product to market, despite it retrenching all of its employees in July.
It was recently granted another extension by industry regulator, the Independent Communications Authority of SA (Icasa), allowing it until February 2011 to launch a service.
“This business wasn’t done right the first time around, and what we want now is really to do it right,” Lockhat says. “If we are given the opportunity we can succeed.”
Super 5 Media, formerly Telkom Media, was one of four pay-TV bidders who received licences from Icasa three years ago to launch products in competition with incumbent operator MultiChoice.
In an exclusive interview with TechCentral, Lockhat admits Super 5 Media is dealing with a number of “issues”, ranging from contractual troubles linked to the sale of the business by Telkom, to reputational troubles linked to media reports about the company.
However, he says the directors are working hard to knock the business back into shape.
“We have suffered many setbacks, just like any other business. But if we manage to get through the turmoil, we will have something to show for it,” says Lockhat.
In July, TechCentral broke the news that Super 5 Media had retrenched all of its remaining employees — more than 40 people in total — and was facing the prospect of closure.
“The retrenchments were unfortunate but necessary. It was a rationalisation of the business,” Lockhat says.
The company was not sustainable with the number of employees on its payroll. “Without a product, we couldn’t keep on a full complement of staff.”
Lockhat says there are several other problems the company needs to work through, including securing a network licence from Icasa.
He says he is concerned “negative press” about Super 5 Media may hamper the application.
Icasa spokesman Paseka Maleka says the authority expects to make a decision on the application in the next two weeks.
But the company’s problems may be much worse than a small matter of licensing.
Last week, Icon Insolvency Practitioners confirmed talk that a liquidation application for Super 5 Media had been submitted and that it was planning to bid as a liquidator.
However, Lockhat vehemently denies Super 5 Media is facing liquidation proceedings. “We don’t know anything about a liquidation and we have not been served any legal notice to that effect.”
Icon won’t say who lodged the application. However, international investment advisory firm Rothschild, which is owed about R25m by Super 5 Media, may have brought it. The outstanding money was for advising on the sale of Telkom’s majority stake in the business to Shenzhen Media SA, led by colourful and controversial Chinese businessman Philip Xiao.
Lockhat won’t comment specifically on the Rothschild matter, but says part of Super 5 Media’s difficulties is to do with contractual troubles related to Shenzhen Media’s purchase of the company.
The intrigue doesn’t end there. Lockhat says he became involved in Super 5 Media when he was asked in July by Xiao to probe allegations of fraud against former director Tian du Pisanie. Lockhat was subsequently appointed to the board.
Du Pisanie has been lying low since leaving the company recently. He has apparently turned his attention to his own Internet service provider business but could not be reached for comment. — Candice Jones, TechCentral
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