BLUE FINANCIAL SERVICES LIMITED - Update on Regulatory Status of Blue

Update on Regulatory Status of Blue

BLUE FINANCIAL SERVICES LIMITED
Incorporated in the Republic of South Africa
Registration Number: 1996/006595/06
JSE Code: BFS
ISIN: ZAE000083655
(“Blue” or “the Company” or “the Group”)


UPDATE ON REGULATORY STATUS OF BLUE


   1. BACKGROUND


       Shareholders are referred to the announcements published on the Stock
       Exchange News Service (“SENS”) of the JSE Limited (“JSE”) on 26 June
       2013 (“June 2013 SENS”), whereby shareholders were advised of the
       Company’s voluntary suspension of trading in Blue securities, 26 August 2013
       (“August 2013 SENS”), 31 October 2013 (“October 2013 SENS”), 6
       December 2013 (“December 2013 SENS”), 1 April 2014 and 30 April 2014
       (“April 2014 SENS”) whereby shareholders were updated on the
       developments at Blue. This includes the conversion of debt in terms of the
       debt rescheduling agreement (“DRA”), the restructuring of Blue Financial
       Services South Africa Proprietary Limited (“Blue SA”), the forensic
       investigations launched in 2010 and 2013 respectively and the status of the
       full year February 2013, six months ended 31 August 2013 and the full year
       ended February 2014 financial results. This announcement serves as further
       communication to shareholders on the aforementioned matters.


   2. UPDATE ON INVESTIGATION COMMISSIONED IN 2010


       The forensic investigation commissioned by the Board of the Company in
       2010 has been completed. Horwath Forensics SA (“Howard Forensic”) was
       appointed to undertake the investigation and their forensic report has
       subsequently been issued. In this regard, the Company has reported to the
       Directorate of Priority Crimes in terms of section 34 of the Prevention and
       Combating of Corrupt Activities Act. The Company will continue to offer its
       full support to all regulatory bodies in their investigation of this matter.
       The Company has instructed its legal team to start with legal proceedings
       against such parties as the report has identified.


3. UPDATE ON INVESTIGATION COMMISSIONED IN 2013


  In the June 2013 SENS, the Company advised that the Board had
  commissioned a new forensic investigation in May 2013. In this regard,
  Horwath Forensics was appointed by the Board of the Company to undertake
  the investigation, which includes inter alia investigating transactions between
  the Company and Leonox Investments (Pty) Ltd (“Leonox”). This forensic
  investigation has been largely finalised and the forensic report has been
  handed to the Company’s auditors to enable them to review the report.


  The Company is now in the process of assessing the findings of the report in
  context of relevant legal and accounting principles with the objective to
  finalise the entries into its financial records that will appropriately reflect the
  transactions between The Company, Leonox and related parties. In order to
  reach finality on this The Company is engaging with its legal team, Auditors
  and related parties.


  The Company has reported to the Directorate of Priority Crimes in terms of
  section 34 of the Prevention and Combating of Corrupt Activities Act.


  The Company will continue to offer its full support to all regulatory bodies in
  their investigation of this matter.




4. FEBRUARY 2013, AUGUST 2013 AND FEBRUARY 2014 FINANCIAL
   RESULTS (“The Financial Results”)


   The Company is currently engaging its auditors to agree time lines and
   resources to conclude the 28 February 2013 results as a priority and will use
   best endeavors to have this concluded by the end of the calendar year. With
   regards to the 28 February 2014 financial results, it should be noted that the
   audit has already commenced and it is expected that these results will be
   finalized in a relative short space of time once the 28 February 2013 numbers
   have been concluded.


   The Board of the Company is fully aware of the importance of concluding the
   Financial Results and would therefore like to give shareholders the comfort
   that the matter is being given the highest priority.


   Once the financials have been released, the Company will announce its
   forward-looking strategy




   5. TRADING OF SECURITIES


       The Board of the Company wishes to advise that it is committed to publishing
       the Financial Results as soon as practically possible, at which point the
       company will apply to the JSE to recommence with the trading of Blue
       securities on the stock exchange operated by the JSE.



Designated Advisor
Grindrod Bank Limited


Randburg
30 September 2014

Date: 30/09/2014 04:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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