Land Bank hits suspended CEO with R3.5m penalty
Daybreak Farms’ Boas Seruwe, abruptly suspended in January as chief executive of the poultry producer midway through his five-year contract, has been slapped with a R3.5m penalty by the Land Bank for irregularly paying out dividends to Daybreak’s shareholder without consent from the development finance institution.
Moneyweb notes Daybreak, one of SA’s leading chicken companies, became wholly owned by the Public Investment Corporation (PIC) in 2015.
The report of the inquiry into allegations of impropriety at the PIC found that six months after the PIC’s investment, Daybreak became technically insolvent.
It found that at the time of the hearings, the PIC’s investment had not been serviced – ‘although proactive measures had been taken by the PIC and it (Daybreak) was recovering well’.
Under Seruwe’s watch, Daybreak paid its shareholder R50m in dividends in May 2020 without informing the Land Bank, through which it has had a R250m revolving credit facility since October 2017.
Moneyweb says it understands that Seruwe is also the subject of a forensic investigation by Daybreak.
The probe’s findings are expected to be released this month.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.
