Intervid coup reversed

By Iain Scott, ITWeb group consulting editor

Johannesburg, 01 Mar 2004

The Intervid share soared this morning after news that the Howard family`s takeover of the board had been reversed.

By late this morning the share was trading at 55c - 15c or 37.5% up on Friday`s close.

The company announced late on Friday that the three board members appointed last week had quit, along with chairman Rob Howard.

The three - Richard Evans, George O`Reilly and Constance Howard - had been nominated by the Howard family, who are the major shareholders through various family trusts.

The Howard family called a shareholders` meeting last Monday to vote on removing Bill Lambert as non-executive chairman and to appoint its nominees to the board.

Lambert resigned as the meeting started. CEO Mark Taylor and financial director Wayne Jaggard also quit the board during the meeting. Johann Pieterse also resigned his non-executive directorship.

Rob Howard replaced Lambert as chairman and the nominees were appointed to the board.

The Howard family had cited a lack of confidence in Lambert and concern at what it said was undue influence by shareholder VenFin.

The previous board, which has now been reappointed, has been given the go-ahead to restart talks with VenFin aimed at recapitalising the business.

Nedbank warned last month that it would call in the company`s overdraft unless surety could be provided.

VenFin had agreed to a loan of R21 million to R40 million, but on condition that the meeting to vote for Lambert`s removal not take place.

VenFin owns 17% of Intervid. Its associate company, RFS Holdings, is Intervid`s principal loan creditor, which holds a convertible bond.

Intervid has been in talks with RFS Holdings regarding the capping of the number of shares that may have to be issued to it when the loan is converted into shares, as well as the continued access to funding in SA from Intervid International.

VenFin said last week that, among other things, RFS had been willing to consider limiting its conversion rights provided in the convertible bond to 65% of Intervid`s issued share capital, although the Howard Family did not support this and other proposals by VenFin.