Following below is our response to an article written by Sygnia MD Magda Wierzycka and published in Business Day on 5 February 2019: “Unknown entities thrive on incredible PIC largesse.”
The Mergence group has engaged with the PIC over the past few weeks in an attempt to get figures corrected which are erroneously stated in the “confidential” memo to which Ms Wierzycka refers. The Mergence Group has two subsidiaries that conduct business with the PIC, namely Mergence Africa Capital and Mergence Investment Managers.
Mergence Africa Capital is a derivative broking, structuring and advisory business. Since 2014 Mergence Africa Capital has been highly rated within the derivative dealing category of the Financial Mail Ranking the Analysts awards, reflecting a skilled and experienced team.
Mergence Africa Capital earned R36m in derivative broking and advisory fees from the PIC between 2014 and 2018 – not R110m as stated. We believe that the figures, that span a number of years, for both our companies Mergence Africa Capital and Mergence Investment Managers have been erroneously combined. If that is the case then the total fees, including asset management fees, for all service providers (including asset/investment managers) of the PIC, should also be published over the same period. We believe the information in the memo Ms Wierzycka refers to, does not compare apples with apples. As mentioned above, we are engaging with the PIC on this matter. To have our reputation tarnished for what is obviously an error is very disconcerting.
Contrary to Ms Wierzycka’s claim that the abovementioned fees were paid to “unknown entities for a range of questionable and badly defined services” both Mergence Investment Managers and Mergence Africa Capital are well known and respected financial services businesses with over a 15-year track record and a highly respected client base that includes Sygnia.
The combined Mergence group manages assets to a value of R43bn and employs over 86 people. All services that these entities have conducted with all of our clients including the PIC have been well defined and all fees have been negotiated at market related rates.
The successful diversified financial services group that is Mergence has been built using our own risk equity and independent bank financing.
Issued by : Lucy Reyburn PR, 082 922 7483
Contact : Izak Petersen, Mergence Capital Africa, 082 823 1748
Ronel Bantjes, Head of Marketing & PR, Mergence Group, 082 563 8610