Verma in hostile bid to reclaim Pula Steel

Dikarabo Ramadubu - BG reporter
Wednesday, 13 March 2019
Verma in hostile bid to reclaim Pula Steel

Former Pula Steel Casting and Manufacturers director, Depaak Verma came short of accusing government officials, CEDA and judicial management officers of being corrupt during a no-holds-barred tirade this week. Verma called a press conference at Hilton Hotel titled, ‘Where is Pula Steel’ ostensibly to share the family’s side of the story.

The family are the initial shareholders of Pula Steel. He blasted the liquidation and the ongoing tendering process, which seeks to sell the Plant. “So many questions have been asked on the company with much focus lately on why the company went for tendering in the first place,” he said. Verma lost control of his company in 2016. He used the conference to attack officers he met in line of duty accusing them of bringing him down and wanting him out of business. Under the Verma family arrangement, huge sums allegedly went missing as per affidavits filed in court during the liquidation process.

Pula Steel troubles started in 2016 when BCL mine who were the majority shareholders got into liquidation.   In 2017 CEDA approved capital funding amounting to P28, 621, 308, 50 following an application by the Verma family on October 2016. CEDA conditions were that shareholders of Pula Steel indemnify CEDA from any claims laid against the company prior to investment period, as well as resignation of all directors and re-appointment of new ones.

The new shareholding structure left BCL with 22.70 percent shares, Verma (23.25), Wealth Generation (5.5) and CEDA with 49 percent shares. CEDA never deposited the money because they were not satisfied that their conditions were met. This appears to have caused friction between Verma and CEDA’s Thabo Thamane and his leadership team.

Bid claim
Verma said he failed to win his company back despite having put an impressive bid that no one could match. He cast doubt on the criteria used to award the tender. He suspected that CEDA must have financed someone to win the bid, asking rhetoically; “what criteria was used to award the bid? Did I not have the capacity? Did I not have the knowledge? Did I not add value to the plant? I do not know that.

“I do not know if they had given the name of the potential owner, but the name of the potential owner was not yet announced until March 2nd. I am still a creditor I deserve the right to know who bought the plant. “What I can say is in February information came out that my bid is successful. It was agreed that within seven days the potential winner had to deposit 30 percent of the money for whatever bid he put in. I have suspicion of the two companies who won, but I can not name them because it can be defamation”.
 He said he is left with no choice except to take the matter to court as they cannot understand why the bid has not been given to his family.

Amongst those Verma attacked were Chief Executive Officer of CEDA, Thabo Thamane, Judicial manager Vijay Kalyanaraman questioning why he was appointed while he was doing jobs for CEDA at the same time. He also asked why CEDA put conditions before they could invest the agreed amount. He claimed that if he was allowed to continue his company model had the potential to grow even much bigger than Debswana.

Speaking to Botswana Guardian Kalyanaraman said he was appointed in his professional capacity and was not new as he previously did an assessment on Pula Steel, before CEDA came aboard. Kalyanaraman said he stepped out as judicial manager because he realised that there was misalignment between Pula Steel shareholders as they did not have a common vision. “The shareholders under Verma family management had different interest which was not in the best interest of the company”. For his part Thamane said it is his responsibility as accounting officer of CEDA to look after the funds of government. 

“I will do that and I will continue looking after these funds within the set parameters, rules and regulations as determined by the CEDA Board. “I will not want to comment on Verma’s character assassination on my side because we are reviewing his press conference and statements and will be accordingly advised by our advisors”.

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