PAAB enters Ongwediva Medipark shares fray
Watchdog probes BDO over ‘dubiously-transferred’ shares
The accounting watchdog is probing claims that shares worth millions were transferred in an opaque manner.
A protracted fight over the ownership of one of the country’s biggest private healthcare groups has taken a new turn after a complaint was lodged calling for the Public Auditors and Accountants Board (PAAB) to investigate accounting firm BDO Namibia.
Businessman and trustee of Ongwediva Medipark Investments, David Imbili, poked holes in the conduct of the auditing firm, which played a major role in a share transfer, saying it failed to execute its duties and allowed an external interest to dubiously gain shareholding in the northern-based hospital.
“i-Care Africa was able to gain an interest in the hospital without the knowledge of the hospital’s other shareholders and directors,” he said in an affidavit deposited with PAAB.
PAAB head of secretariat Zaa Nashandi confirmed that a complaint had been lodged, adding that an investigation into BDO Namibia’s conduct is underway.
“I can confirm that the complaint in question has been lodged with the PAAB. However, I am not at liberty to discuss details as the matter is still under investigation,” he said yesterday.
In his affidavit, Imbili said BDO Namibia had - in an audit opinion - stated that Ongwediva Medipark complied with relevant legislation, despite i-Care Africa gaining interest in Erongo Medical Group (EMG), a shareholder in the hospital.
“Mr Riel du Toit, through a concern known as i-Care Africa, seemingly gained control of a Namibian entity EMG. The same concern ultimately - through a series of transactions - violated the shareholders agreement and the companies’ articles of association gained control by transacting in frankly dubious means to the detriment of both shareholders and directors of companies,” he said.
Share register
The acquisition of EMG by Port Elizabeth-based businessman Du Toit caused a material change in the share register of Ongwediva Medipark, Imbili said.
He was seemingly dumbfounded that the development did not raise any red flags in BDO Namibia’s audit of the hospital’s financials.
“Unbeknownst to the shareholders and directors, EMG caused a material change in the share register and when the audit was conducted, a clean audit [was received] and the opinion formulated was that the company complies with all legislation.
“It has now come to my attention - through the initiation of a court process - that EMG violated the shareholders agreement of Ongwediva Medipark. The auditors failed in their duties to properly ascertain compliance with all the relevant legislation,” he added.
The auditors, Imbili said, failed to inform interested parties in Ongwediva Medipark that EMG had gained control of the hospital.
“The auditors failed to report that EMG took effective control of the business. The auditors did not carry out their work properly and failed to uphold the standard required of an audit firm.”
Matter under investigation
Namibian Sun contacted BDO Namibia country manager Charl Celliers via email, while multiple calls were made to his work number, receiving no response.
Ongwediva Medipark founder Dr Tshali Ithete, through his company Diversified Medical Investments, launched a court case in May 2021 seeking an order to reverse the sale of shares which saw Eos Capital’s special purpose vehicle, Allegrow Fund, acquiring a minority stake in the group.
The case comes less than six months after EMG sold 510 shares - valued at N$23.3 million - to Allegrow, allegedly without following due process.
Businessman and trustee of Ongwediva Medipark Investments, David Imbili, poked holes in the conduct of the auditing firm, which played a major role in a share transfer, saying it failed to execute its duties and allowed an external interest to dubiously gain shareholding in the northern-based hospital.
“i-Care Africa was able to gain an interest in the hospital without the knowledge of the hospital’s other shareholders and directors,” he said in an affidavit deposited with PAAB.
PAAB head of secretariat Zaa Nashandi confirmed that a complaint had been lodged, adding that an investigation into BDO Namibia’s conduct is underway.
“I can confirm that the complaint in question has been lodged with the PAAB. However, I am not at liberty to discuss details as the matter is still under investigation,” he said yesterday.
In his affidavit, Imbili said BDO Namibia had - in an audit opinion - stated that Ongwediva Medipark complied with relevant legislation, despite i-Care Africa gaining interest in Erongo Medical Group (EMG), a shareholder in the hospital.
“Mr Riel du Toit, through a concern known as i-Care Africa, seemingly gained control of a Namibian entity EMG. The same concern ultimately - through a series of transactions - violated the shareholders agreement and the companies’ articles of association gained control by transacting in frankly dubious means to the detriment of both shareholders and directors of companies,” he said.
Share register
The acquisition of EMG by Port Elizabeth-based businessman Du Toit caused a material change in the share register of Ongwediva Medipark, Imbili said.
He was seemingly dumbfounded that the development did not raise any red flags in BDO Namibia’s audit of the hospital’s financials.
“Unbeknownst to the shareholders and directors, EMG caused a material change in the share register and when the audit was conducted, a clean audit [was received] and the opinion formulated was that the company complies with all legislation.
“It has now come to my attention - through the initiation of a court process - that EMG violated the shareholders agreement of Ongwediva Medipark. The auditors failed in their duties to properly ascertain compliance with all the relevant legislation,” he added.
The auditors, Imbili said, failed to inform interested parties in Ongwediva Medipark that EMG had gained control of the hospital.
“The auditors failed to report that EMG took effective control of the business. The auditors did not carry out their work properly and failed to uphold the standard required of an audit firm.”
Matter under investigation
Namibian Sun contacted BDO Namibia country manager Charl Celliers via email, while multiple calls were made to his work number, receiving no response.
Ongwediva Medipark founder Dr Tshali Ithete, through his company Diversified Medical Investments, launched a court case in May 2021 seeking an order to reverse the sale of shares which saw Eos Capital’s special purpose vehicle, Allegrow Fund, acquiring a minority stake in the group.
The case comes less than six months after EMG sold 510 shares - valued at N$23.3 million - to Allegrow, allegedly without following due process.
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