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Jeremy Ord and other former senior Dimension Data executives “entered into an illegal scheme” designed to benefit them personally at the expense of the company and its Japanese parent, NTT Group, according to a scathing high court judgment handed down on Monday and seen by TechCentral.
The court ordered that the sale of Dimension Data’s The Campus property in Johannesburg is null and void and awarded punitive costs against the former executives, who may now face further legal and even criminal action flowing from the judgment.
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NTT Group, which owns Dimension Data – recently renamed NTT Data – is seeking unspecified damages against the former executives. It also wants to have them declared delinquent directors under section 162 of the Companies Act.
The executives are:
- Jeremy Ord, who until mid-2021 served as Dimension Data’s executive chairman;
- Jason Goodall, a former Dimension Data CEO who later took the reins at NTT Ltd;
- Grant Bodley, who served as Dimension Data Middle East & Africa CEO until March 2021;
- Steven Nathan, Dimension Data’s former head of corporate finance, who resigned in mid-2021;
- Saki Missaikos, a former MD of Dimension Data’s Internet Solutions who was group head of strategy prior to his exit, also in mid-2021; and
- Bruce “Doc” Watson, a Dimension Data stalwart who left around the same time.
The judgment comes about two years after Dimension Data filed papers at the high court in Johannesburg against several former top executives, including former executive chairman Ord, over the transaction involving the sale of its head office, The Campus, in Johannesburg nearly five years ago.
TechCentral broke the news in January 2022 that several former executives – many of whom are well known in South Africa’s business community – had become embroiled in a fraud scandal following a forensic probe into the December 2019 sale of The Campus in a complex BEE transaction.
The investigation came after NTT Ltd, which is owned by Japan’s NTT Group, appointed international law firm Herbert Smith Freehills to conduct a forensic investigation into allegations brought forward by a whistle-blower.
Damning findings
In the judgment handed down on Monday, the high court not only found in favour of NTT but awarded punitive costs against the former executives and made several damning findings against them.
High court judge Denise Fisher found that the executives had “entered into an illegal scheme designed to appropriate for themselves a secret financial benefit which placed them in conflict with their boards”. She described the scheme as “brazen and dishonest” and said it was orchestrated “without due regard to the relationships between the Japanese holding entities (NTT) and the South African interests”.
Read: Dimension Data sells The Campus, unveils significant shake-up
The judge also found that should “this kind of flouting of foundational and universal commercial values remain unchecked and unpunished, this would represent a travesty of South Africa’s commitment nationally and internationally to the upholding of the values of honesty and integrity which are so intrinsic to proper commercial relationships”.
The former executives were also lambasted by Fisher for “subverting” black economic empowerment legislation for their own benefit. The judge described the behaviour of these “white captains of industry” as of “grave concern”.
“This is a cautionary tale for those who apply and regulate the BEE infrastructure, which is so vital to the development of our constitutional democracy.”
In a statement e-mailed to TechCentral on Tuesday in response to the judgment, NTT Data said it has instructed its legal representatives to “take the necessary steps to implement the judgment”.
“NTT Group takes a very strong stand against breaches, abuses and ethics violations, and is pleased with the judgment received on Monday,” it said.
In its statement, it said that:
- In October 2022, NTT Group instituted legal proceedings to have The Campus transaction declared null and void based on, among other things, the executives’ failure to disclose their interests in the transaction;
- ID Propco, the purchaser of The Campus, was established by Identity Property Fund 1 to purchase the property. ID Propco is wholly owned by the fund. The fund was structured as a limited partnership, originally comprising a black-owned general partner;
- The executives held beneficial majority financial interests in the fund, through the fund’s limited partner and major investor, Areti;
- The executives’ financial interests, which were not disclosed to NTT Group, were held through a complicated partnership structure, enabled by Martin Epstein, a consultant to the then-Dimension Data Group; and
- During November 2022, Areti removed the general partner of the fund and replaced them with a company owned by Epstein, effectively securing complete control of and beneficial financial interest in The Campus by the executives and Epstein.
An anonymous source told TechCentral in January 2022 that e-mails uncovered by Herbert Smith Freehills showed how the “implicated executives conspired to sell The Campus” to Identity PropCo, a black women-owned firm led by businesswoman Sonja De Bruyn, at a “price well below its market value. Simultaneously, the implicated executives secured their participation in a separate but related entity that would see them profit handsomely from the undervalued sale of The Campus. Simply put, this amounted to the defrauding of the ultimate owner of The Campus, that being Dimension Data’s parent company, NTT.”
TechCentral has reached out to a representative of the former executives for comment. — (c) 2024 NewsCentral Media
- This is a developing story
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