Investors in Sharemax's two largest syndications, Zambezi Retail Park and The Villa, did not receive their normal income payments on Tuesday. It is usual for investors to receive these payments at the end of each month.
The late payment has already caused a flurry of enquiries from concerned investors. The Villa and Zambezi account for more than half the value of the entire Sharemax portfolio.
These two syndications were sold to Sharemax investors by Capicol, a relatively unknown property developer.
Capicol is responsible for making payments to investors. However, Capicol ultimately gets its money from Sharemax investors. Some commentators have accused this structure of being a type of pyramid, where newer investors fund payments to existing investors.
Sharemax has recently run into some difficulty raising money for The Villa, a massive unfinished shopping centre east of Pretoria. This comes after the Reserve Bank declared Sharemax's investment structure to be illegal, and media reports questioned The Villa's viability.
Neither Sharemax nor Capicol has admitted that there is a cash-flow problem. But if nothing was amiss with Sharemax it is unlikely that its directors would even consider the idea of listing investors' assets into tiny property company Bonatla in a non-cash transaction.
A financial adviser who asked Sharemax on Tuesday why his clients had not been paid received the following reply: "The administrator who makes the payments was in a meeting the whole day and could not therefore get to make the payments."
On Wednesday Sharemax released a different reason for the late payments to its brokers:
There are currently many inquiries about the fact that interest rates on Zambezi and The Villa were not paid yesterday. Below is a draft response to queries received:
The final negotiations regarding the offer on the Sharemax portfolio between Capicol and Bonatla are not yet finalised. Therefore interest payments for The Villa and Zambezi retail could not be paid out.
We hope the negotiations will be completed within the next two days, after which interest payments can be made.
Note: The prospectus makes provision for interest payments to be made on or before the second work day of each month.
Any new developments will be immediately communicated to you.