Legal first for investors in AIDS nutrition business

In terms of an order granted by KZN High Court (Durban) Judge Esther Steyn, they may now initiate liquidation proceedings against Edge to Edge Global Investment, notes a report in The Mercury. If successful, a liquidator will probe how the directors - John and Kathy Ellis and Jan Louw - spent R66m invested in the public company and if, as alleged, they used it to fund their lavish lifestyles. The shareholders went to court complaining they had invested on assurances that their money would be used to develop the nutrition pack - 'a possible cure for AIDS' - to be sold across Africa. The case has made legal history because it is believed to be the first of its kind involving a section of the new Companies Act, which dictates that shareholders wanting to liquidate a company on allegations of fraud, must first get the sanction of the High Court. The judge said she would still give written reasons - which would become case law - but gave her ruling immediately after hearing argument, saying 'I am satisfied that this should not be delayed'. The report adds her ruling in favour of the shareholders, including overseas businessmen, is significant in that they have proved, on the face of submissions in their papers, that there has been some fraud or waste of company assets. Full report in The Mercury