Flora Centre – Debenture Holders stand to lose potentially up to 100% of their initial investment
- jp55467
- 3 days ago
- 6 min read
Updated: 2 days ago
Executive Summary – Debenture Holders stand to lose potentially up to 100% of their initial investment
This Memorandum sets out evidence of a carefully orchestrated plan by the Board of Directors to circumvent the Compliance Notice issued by the Companies and Intellectual Property Commission (“CIPC”). This plan, once executed, will result in a deliberate and complete loss for Debenture Holders in the Carletonville Centre and Range View classes. Furthermore, based on the documented conduct of the Board, I am of the professional opinion that this matter is reportable under Section 34 of the Prevention and Combating of Corrupt Activities Act 12 of 2004 (PRECCA).
Imminent Losses:
Debenture Holders in Carletonville Centre and Range View classes are highly likely to lose 100% of their initial investments, adding to prior concerns regarding Amogela Mall and 12 other Debenture classes collectively owed R 415 million without underlying assets.
Flora Centre insolvency and liquidation risk:
On 10 September 2025, Capitec Bank filed a High Court application for the final liquidation of Flora Centre (Case No. 2025-161465). Flora Centre is factually and commercially insolvent, with a negative asset value of nearly R 40 million with the debt due to Capitec amounting to approximately R 57 million.
Board’s reckless conduct:
Evidence from emails by Nova’s CEO, Ms. Dominique Haese (Annexure B), reveals a deliberate scheme by the Board to circumvent the CIPC Compliance Notice by proposing the sale of the Carletonville Centre and Range View properties to settle Flora Centre’s debts. This action would misappropriate assets belonging to one class of Debenture Holders for the benefit of another, constituting gross negligence and reckless behaviour.
Regulatory breach:
The CIPC Compliance Notice (Annexure C) prohibits disposal of immovable property pending a Companies Tribunal ruling. The Board’s proposed actions directly contravene this Directive, undermining protections intended for Debenture Holders.
Conclusion
I will start with immediate consultation with my attorneys and the CIPC to enforce compliance and prevent asset misappropriation and also consider urgent intervention to safeguard Debenture Holder interests and hold the Board accountable for fiduciary breaches.
A more detailed disclosure of the aforementioned facts, along with references to the underlying supporting documentation, is provided in the annexures attached to this Executive Summary.
Kind regards
Jean-Pierre Tromp
In my capacity as Trustee of the Debenture Trust
Comment – 26 November 2025
On 26 November 2025, I received an email from Me. Dominique Haese, the CEO of Nova in response to this Memorandum.
The email, titled “Nova - Flora Centre (Response - D Haese)'"is attached for reference.
Me. Haese's comments are as follows:
‘Good day Mr Tromp,
Your below email, Executive Summary and Memorandum attached thereto, refers.
You are dealing with my letter ("the letter") incorrectly and out of context.
The letter was written during without prejudice negotiations between Flora Centre Investments Proprietary Limited ("Flora") and Capitec Bank Limited ("the bank"), regarding the secured debt of Flora to the bank. The bank holds, as security, mortgage bonds over the property of Flora and the properties of two sureties to the bank, Carletonville Centre Investments Proprietary Limited ("Carletonville") and Rangeview Shopping Centre Investments Proprietary Limited ("Rangeview"), and the bank therefore has the right to engage with Flora regarding the sale of the properties over which the bank holds security, which process transpired prior to the letter.
In the letter, the bank is specifically advised that the Nova Group is under CIPC Directive and may not sell properties. A screenshot of the relevant portion of the letter below:
[PLEASE REFER TO THE SCREENSHOT IN ME. HAESE'S EMAIL IN THE ANNEXURE]
However, on advice from Senior and Junior Counsel, the sale of a property is feasible and not in contravention of the CIPC Compliance Notice, if it follows upon a High Court Judgement, allowing the judgement creditor (in this instance, the bank) to execute its claim against the said property over which the creditor has a duly registered securing bond. This position was advised to the bank in the letter, and it was suggested that the legal advice be followed. This was a without prejudice suggestion, in the process of negotiating a settlement with the bank.
The two companies, Carletonville and Rangeview, are sureties to the bank regarding the claim of the bank against Flora, and the bank would have been able to execute in terms of the surety bonds held by the bank, against the properties of these two surety companies, to procure payment of the debt of Flora to the bank. That is why these to "surety properties" were topical at the time of the letter.
It was suggested that an execution process, according to the legal advice, regarding the two "surety properties", should take place in procuring the payment of the debt of Flora to the bank, as the surety companies were liable for the payment of the debt, as sureties.
The bank would have had, at all times, sole discretion as to which of, or all three, the bonded properties it wished to execute on in payment of its claim against Flora.
The suggestion to execute on the two properties owned by the two sureties, Carletonville and Rangeview, to settle Flora's debt to the bank, was fully legal, on Senior and Junior Counsel advice, and was put forward during negotiations and no more.
The very fact that the Group took legal advice militates against any deliberate attempt ("carefully orchestrated plan" according to you) to "circumvent" (as you incorrectly put forward) the CIPC Compliance Notice.
The taking of Senior and Junior Counsel legal advice in fact points to just the opposite, namely ensuring no transgressing or circumvention of the CIPC Compliance Notice, as you incorrectly suggest.
The suggestion to execute on the two surety properties was not followed through on and there has been no and is no disposal of the subject matter two surety properties owned by Carletonville and Rangeview.
The CIPC Compliance Notice is not being "circumvented" as incorrectly suggested by you.
From the above it is clear that the Group is and has always been fully compliant with the CIPC Compliance Notice, as the Group has not disposed of properties and that no asset misappropriation is taking place, as incorrectly suggested by you.
Following from the above, we reject your notion of "a carefully orchestrated plan by the Board of Directors to circumvent the Compliance Notice" issued by the CIPC.
We further reject your notions put forward in your Memorandum, that there now exists documentary proof that the Board is acting with gross negligence and reckless disregard of its fiduciary duties and that the Board's actions reflect a state of financial desperation and that it is evident that the Board is not acting in the best interests of Debenture Holders.
The Debenture Holders in the Carletonville Centre and Rangeview classes are and remain unaffected by the suggestion in the letter and are not "highly likely to lose 100% of their initial investments", as incorrectly stated by you.
We reject your notion that "this matter is reportable under Section 34 of the Prevention and Combating of Corrupt Activities Act 12 of 2004". We reserve our rights to act against you resulting from this unwarranted defamatory statement.
As to the Memorandum, suffice at this stage, to say that we reject the entire Memorandum, and reserve our rights to reply to the Memorandum in detail, should the need arise.
Save as dealt with above regarding the Memorandum, we restrict our response to the Executive Summary, in the interests of time expediency, to get our responses to the parties copied into your email under reply, as soon as practicably possible.
Both in the Executive Summary and in the Memorandum, you disseminate many incorrect and defamatory matter regarding the Nova Group and its directors, regarding which we reserve our rights to institute legal proceedings against you.
We assume that you have placed the below email and Memoranda on your website. Please also place this response on your website, in a prominent location.
Like so many times in the past, we again invite you to meet with us, to be appraised of the correct facts before you embark upon writing memoranda which do not reflect the correct facts and disseminating same to third parties.
Please consider taking us up on our invitation as it serves no one to continue in this manner.
Kind Regards’
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