Gijima's shareholders shied away from its recent rights offer, leaving most of the stock in the hands of chairman Robert Gumede, City Press reports.
Gijima issued shares to raise R100 million - an additional move over and above the R150 million it raised a year ago. This issue was fully underwritten by its major shareholder, the Guma Group of companies, founded by Robert Gumede.
The listed company has said it budgeted for sufficient cash flow to meet its obligations, but noted it if is not able to raise the cash, roll debt over, and meet its budget, "there exists a material uncertainty which may cast significant doubt about the company and subsidiaries' abilities to continue as going concerns".
According to the City Press, just under half of Gijima's shareholders - including Guma - subscribed for the additional stock. This, it says, means Guma owns by far the majority of Gijima, with all but 1.7% of its stock in Guma's ownership.
The paper notes, however, Gumede has been positive about the rights offer, quoting him as saying the 88.3% the Guma group now owns allows Gijima to broaden its empowerment holding.
Gumede also told the paper that the ownership bucked the trend of other ICT companies, of the same size as Gijima, being either white- or foreign-owned. He noted he was a committed shareholder and invested in the company for the long haul, the paper reports.
Gijima has been battling financially, and - in the year to June - reported turnover lower at R1.5 billion, down from 2013's R1.8 billion. It renewed all its contracts in the private sector and repaid R41 million in debentures. Its turnaround, which had at the time been underway for about a year, resulted in savings of R200 million.
During the period, its net loss came in at R153 million, a large improvement on last year's R294 million, but it noted - despite "vast" internal improvements, it continued to face tough trading conditions, and was not able to comply with the financial covenants for its R213 million in debt.
Gijima has entered into a new deal with its financiers, pushing out the due date of the debt into equal tranches due between 2017 and 2020.
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