Joe Dinga Pefok (Uncle Joe)
The Untold Story of the Liquidation of Baba Danpullo’s Companies In South Africa (PART 1)
- The Real Estate Companies that Danpulo’s Family Created in South Africa, and the Shareholders
- The Mortgage Bonds that Danpullo Signed, Mortgaging all his Companies for Loans Obtained from FirstRand Bank
- Details of the Loans and the Terms of the Agreement that Danpullo himself Signed with the Bank
From what THE MENTOR has been able to gather so far as regards what happened that the companies of Cameroonian businessman, Ahmadou Baba Danpullo, in South Africa were placed on liquidation in 2020, it should first of all be noted that before 2020 he had been doing business in MADIBA’s great country for over 30 years.
As Baba Danpullo himself put it, his companies were real estate investment companies “focused mainly on investment opportunities in the commercial and residential property market”. They were all real estate companies and were doing business in three cities in South Africa, namely Cape Town, Port Elizabeth, and Johannesburg fondly known as Joburg.
Bestinver Company South Africa Propriety Limited
Over the years, Baba Danpullo’s businesses in South Africa grew into three companies, which were all registered as limited liability companies. The companies were Leopont 193 (Pty) Limited, BestinverPop 01 (Pty) Limited, and Joburg Skyscraper (Pty) Limited. Bestinver Company South Africa Propriety Limited was created to run the three other companies. All the three companies thus became the affiliates of Bestinver Company. In other words, Bestinver Company South Africa Propriety Limited, or better still Bestinver Group as Baba Danpullo often called it, was the mother company of Leopont 193 (Pty) Ltd, BestinverProp 01 (Pty) Ltd, and Joburg Skyscraper (Pty) Limited.
In this story, which is in three parts, THE MENTOR will most of the time call the Bestinver Company South Africa Propriety Limited as Bestinver Group for clarity, considering also that one of the affiliates, BestinverProp 01 (Pty) Limited, has a similar name.
10 Shareholders of the Bestinver Group
On paper, Bestinver Company South Africa Propriety Limited had 10 shareholders, who were the following:
- Yasmina Baba.
- Ahmadou Bab.
- Lantana Baba.
- Ahmadou Baba Danpullo.
- Houssene Baba.
- Maimouna Baba.
- Animatou Baba.
- Zayd Baba.
- Hassan Baba.
- Moussa Danpullo Baba.
From the look of things, it was a family business of Ahmadou Baba Danpullo and his children or with his children and some other family members. On paper, each of the 10 shareholders had a 10% share of Bestinver Group. Ahmadou Baba Danpullo was the Board Chair, while Moussa Danpullo Baba was the Managing Director of Bestinver Group.
Ahmadou Baba Danpullo’s Affidavit on Oath
Meanwhile, as regards the loans that Bestinver Company South Africa Propriety Ltd obtained from FirstRand Bank Ltd that ended up landing the Group into trouble because of several defaults to repay the loans, it should be noted that the actual summary and background are among other things contained in a 20-page affidavit that Ahmadou Baba Danpullo declared on oath. He presented the declarations himself and signed in front of the Commissioner of Oaths, at the High Court of South Africa, Gauteng Local Division, Johannesburg, on December 8, 2020. The Commissioner of Oaths was Andle Seth. The 20-page sworn affidavit comprised 66 points and several sub-points.
It should be noted that an affidavit on oath obliges one to be honest in what he says because it is a serious crime to say something on oath and it is proven to be a lie (lie on oath). In our courts, judges often ask especially persons who come up to testify in matters if they want to testify on oath or not. In a country where the law is taken seriously, the penalty for lying on oath is imprisonment, not a fine.
Baba Danpullo Presented Himself as Shareholder
Meanwhile, the matter which came up at the High Court in Johannesburg on December 8, 2020, was a matter between The Shareholders of Bestinver Company South Africa Propriety Limited (Registration number 1994/009380/07) as Applicant, and Bestinver Company South Africa Propriety Limited in Liquidation (Registration number 1994/009380/07) as First Respondent, with FirstRand Bank Limited as Second Respondent, and SECHARA Trust as Third Respondent.
The FOUNDING AFFIDAVIT opened with the statement: “I, the undersigned, AHMADOU BABA DANPULLO, hereby make and declare as follows:” Danpullo presented himself as: “I am an adult male person and the shareholder of the First Respondent, Bestinver Company South Africa Propriety Limited in liquidation”. The declarations start from Point 1 to 66, with several sub-points, the end of which he signed as Despondent, and the Commissioner of Oaths also signed.
Loans Bestinver Group Obtained From FirstRand Bank
It is stated in Point No. 11 in Baba Danpullo’s Affidavit that: “On 19 August 2016, at Cape Town, Ahmadou Baba Danpullo, acting on behalf of the First Respondent, and the Second Respondent entered into a written loan agreement (loan agreement A) in terms of which the First Respondent was afforded a credit facility in the sum of R 210 million by the Second Respondent”. Point No. 13.2 stated that: “The First Respondent would repay the loan over a period of 120 months”. Point No. 13.3 “The monthly repayment installment would be R 3,179.65 in respect of Month 1 to Month 60, and R 1,942,617.83 in respect of Month 60 to 120”. Point 13.4 “Interest would be calculated at Prime .50%”. Worth noting that South Africa’s currency is known as rand, and so R 20 for example means 20 rand.
Security Guarantees For The Loan
Meanwhile, as regards the security guarantee for the loan, Point 14 in the affidavit stated that: “The following security would inter alia be provided by the First Respondent (Bestinver Group) to the Second Respondent (FirstRand Bank)”. Point 14.1 names the security guarantees: “Cross-Sureties, Johannesburg Skyscraper and Leopont Limited to R 350 million”. 14.2 “A Mortgage Bond registered by the First Respondent over a property located in Princess Location in Pretoria in the amount of R 150 million”. 14.3 “A Mortgage Bond registered by Joburg Skyscraper over ERF 8757, Walmer, Eastern Cape in the amount of R 120 million”. 14.4 “A Mortgage Bond registered by the First Respondent over Erf 141646, Cape Town, Western Cape in the amount of R 120 million”. 14.5 “A Mortgage Bond registered by Leopont over 117068, Cape Town in Western Cape, in the amount of R 30 million”. 14.6 “A Notarial Deed registered under K 1235/1994 in respect of ErF 141644 Cape Town, Western Cape in the amount of R 30 million, and” Point 14.7 “Leopont and Joburg Skyscraper and companies with our Group of companies”.
What Was To Happen In Case Of A Default
Furthermore, Ahmadou Baba Danpullo in Point No. 15 in the Affidavit further declared the following undertakings to the Second Respondent that is FIRSTRAND Bank, on behalf of the First Respondent, that Bestinver Group. Point No. 15.1 “I would on request furnish the Second Respondent with signed and audited financial statements as soon as they are available”. Point 15.3 “I may if I become aware of any occurrence of any circumstance which may result in a default or potential event of default forthwith, advise the second Respondent in writing”.
Readers should take particular note of what Point No. 16, Point No. 16.1 and Point No. 16.2 say as was agreed by Ahmadou Baba Danpullo on behalf of the First Respondent (Bestinver Company South Africa Propriety Limited) and the Second Respondent (FirstRand Bank Limited), as to what would happen in case of a default on the repayment of the loan by installments. Take note that Point No. 16 does not end, as it connects to Point No. 16.1.
Point No. 16: “Upon the occurrence of an event of default or potential default, the Second Respondent would in addition to and without prejudice to any other rights it may have in terms of loan agreement A or in Law, have the right upon notice to immediately, (Point 16.1) Accelerate and or place on demand, payment of loan outstanding which shall become due and payable, and (16.2) CALL UP AND EXECUTE ANY SURETY DOCUMENT”.
Conditions To Be Granted A Loan
Worth noting that banks do not invite people or companies to come and get loans. If you go to a bank to ask for a loan, and the bank gives you its terms or conditions for the loan, it is for you to accept or leave it. You are under no obligation to accept the terms. But if you accept the terms set by the bank, and then sign the agreement and obtain the loan, you should bear in mind that you have an obligation to respect the terms of the agreement. You cannot after collecting and spending the money start complaining that the conditions for the loan were too tough, as if the bank forced you to accept. That is being dishonest and irresponsible.
Another Loan Package From FirstRand Bank
Meanwhile, the loan agreement was signed between the First Respondent (Bestinver Group) and the Second Respondent (FirstRand Bank) on August 19, 2016, was not the first time that the latter granted a loan to the former. In fact, Bestinver Group had been a client of FirstRand Bank for a number of years before, though it would appear that the loans that the former used to demand from the latter were comparatively smaller. But it was because of that existing relationship that FirstRand Bank in the first place accepted to grant the big loan to Bestinver Group.
Meanwhile in 2017, Bestinver Group went to FirstRand Bank to ask for another loan package. Point No. 21 of the declarations that Ahmadou Baba Danpullo made in the Affidavit on Oath disclosed that on October 11, 2017, Bestinver Group and FIRSTRAND Bank signed another written loan agreement (loan agreement CI) in terms of which the bank granted the Group’s affiliate, BestinverProp01 (Pty) Ltd, a credit facility in the amount of R 260 million, to be given in two installments (Part A for R 160 million, and Part B for R 100 million). Baba Danpullo on behalf of Bestinver Company also signed a number of mortgage bonds registered for the loan.
By mortgaging BestinverProp for the loan obtained in 2017, Baba Danpullo had mortgaged all the three companies that were owned by Bestinver Company South Africa Propriety Limited, for the two loans obtained in 2016 and 2017 from FirstRand Bank Limited. Bestinver Group also took an overdraft of R 5 million from FirstRand.
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