Foursight Holdings Proprietary Limited (FH), the intermediary investment holding company of some of the South African subsidiaries, has filed for business rescue, becoming the latest local tech company to stumble.
FH is a subsidiary of JSE-listed technology group 4Sight Holdings.
4Sight informed investors on Tuesday are advised that the directors of FH have passed a resolution placing FH into business rescue in terms of section 129 of the Companies Act, 71 of 2008.
FH is an intermediate holding company, within the 4Sight group, and is heavily dependent on the cash flows in the form of dividends and management fees from its profitable subsidiary companies.
“These flows of funds have not materialised thus placing FH in financial distress,” said 4Sight.
“The board is of the view that (on a consolidated basis) the FH operating subsidiaries within the 4Sight group are profitable businesses, which generate large cash reserves.”
Last week, the share price of 4Sight tanked 24% to 16 cents after its chairperson of the audit and risk committee, Geoffrey Carter, quit due to an “untenable situation” at a major subsidiary level amid a board room battle.
“Carter has resigned due to the untenable situation at a major subsidiary level, which has led to such subsidiary executives sending a variety of emails containing, inter alia, false accusations,” said 4Sight in a statement last week.
For more read: 4Sight Holdings share price tumbles 24 percent