News24.com | Paper prices and July unrest: Why Surve's Sekunjalo can't 'support' Independent Media anymore

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Iqbal Survé-chaired Sekunjalo said it had ploughed billions of rands into Independent Media without any help from other shareholders, and now, because of load shedding, high paper prices and the impact of Covid-19 and July 2021 unrest, it "cannot continue to support the company" any longer.

Last week Independent Media, which owns titles including The Star, Cape Argus and Pretoria News, was unable to pay staff their full salaries, with CEO Takudzwa Hove saying in a memo that shareholders could no longer support the company. After the memo leaked, the remainder of the salaries came through, with another note saying Sekunjalo had "agreed to provide a capital injection whilst Independent Media works to make the business self-sustainable".

Independent Media is also chaired by Iqbal Survé.

Sekunjalo said in a statement on Wednesday that it invested nearly R3 billion in media assets alone, and as part of the Sekunjalo Independent Media consortium, specifically invested nearly R1.2 billion over a decade to support the media company through its "challenges".

"For the record, Sekunjalo’s other partners in Independent Media – historically the Public Investment Corporation (PIC) and the [Chinese] Interacom Investment Holdings consortium – have not invested any further funds into Independent Media, other than at the initial stage of the acquisition," Sekunjalo said.

"However, as the principal funder/investor in Independent Media, Sekunjalo informed the management team… several months ago, that whilst it had supported the company from inception, and through many external and unforeseen challenges, Sekunjalo cannot continue to support the company without Independent Media itself taking the necessary steps to become self-sustaining."

Sekunjalo said the challenges included the disruptions caused by Covid-19, the July unrest, load shedding, inflation, and importantly, price hikes for newsprint paper.

This comes as AYO, a subsidiary of African Equity Empowerment Investments - which, like Independent Media, falls under Sekunjalo - settled a case with the PIC.

The state-owned asset manager had taken AYO to court in a bid to claw back the R4.3 billion it invested in the IT group in 2017. The order has not been made public, and Sekunjalo insists the Independent Media issue is not related to this.