Property magnate Nic Georgiou will soon face a class action suit of more than R3bn from the Highveld Syndication Action Group (HSAG) on behalf of thousands of investors in the former Highveld Syndication (HS) schemes, according to a report on the Moneyweb site.

The Gauteng High Court (Pretoria) granted the HSAG certification for a class action this week.

The R3bn will be claimed from several respondents, including Georgiou in his personal capacity and his son Michael, the CEO and majority shareholder in the Accelerate Property Fund. The business rescue practitioner of the HS companies and former Orthotouch director Hans Klopper is also a respondent.

The certification only relates to investors in the HS 21 and HS 22 schemes as their original investment agreements included specific buyback agreements.

In terms of these agreements, Georgiou committed to repurchase the investors’ shares in the respective HS companies in 2014, notes Moneyweb.

The certification judgment cited a recent SCA ruling, which confirmed that the buyback agreements were not affected by the decision to put the HS companies into business rescue or the adoption of the Section 155 Scheme of Arrangement in 2014.

This ruling came after an individual investor sued Georgiou. The investor was represented by Advocate Louis Bolt. Johan Stander, an executive of the HSAG, said the HSAG is pleased with the certification.

‘We have a good case. We can now put our case to the court and prove thousands of investors were fleeced. We are also pleased that the court acknowledged the good work the HSAG’s legal team has done and that their fees were fair. Hopefully, this judgment will also bring an end to the unfounded allegations and lies regarding the HSAG and our legal representative Jacques Theron of Theron & Partners.’

Full Moneyweb report

Judgment