With an original business plan of R7-billion to enable it to compete with Multichoice and its DStv service, Super5 Media is in financial ruins and faces liquidation because of mounting debt.
The Times has established that Super 5 Media, formerly known as Telkom Media, retrenched all of its 40-or-so employees a week ago after a R25-million liquidation claim by one of its biggest creditors.
Super 5 Media had until Friday to settle its debt with Rothschild, an international investment company, for advisory fees related to Telkom's sale of the business to Shenzhen Media SA last year.
The company reportedly failed to honour the rental agreement for its offices in Centurion, near Pretoria. The owners of the building obtained an attachment order against all Super 5 Media's moveable asserts.
After months of silence by Super 5 Media management, and without notice, employees were last Tuesday handed unsigned termination letters printed on plain paper without a company letterhead.
Staff last week told The Times that they were left in limbo and are "fuming" at the company's "blatant disregard for fair labour practice".
"I stayed loyal to the company because I believed it was a brilliant business plan that would make it the biggest broadcaster in Africa, if not the world. My loyalty has now left me with big financial woes," said one staff member.
Most of the staff, which includes highly experienced broadcasting professionals, were head-hunted at great expense. At one stage, the monthly salary bill was R2.9-million for just over 50 staff members, according to a senior manager.
Three senior staff members said the company promised them only one month's pay and told them that they would not receive retrenchment packages or be paid out for leave.
Their June salaries were paid two weeks late, July salaries are still overdue and staff believe that it will be some time before they are compensated, if at all.
Several attempts to contact Super 5 Media directors, including Mandla Ngcobo, Tian du Pisane and Philip Xiao, were unsuccessful last week.
Three weeks ago, staff complained about Super 5 to the Commission for Conciliation, Mediation and Arbitration. To date, the company has not responded to the complaint.
A staff member who accepted a voluntary severance package more than two months ago, said he was still waiting to be paid.
"It doesn't take a rocket scientist to see there is trouble in the business," he said.
Staff said that on July 26, Yunus Shaik, brother of convicted fraudster Schabir Shaik, acting on behalf of Shenzhen Media, spoke to the staff about salaries and promised that they would be paid within days.
Employees believe Super 5 Media's troubles worsened when Telkom Media sold the business to Shenzhen Media in 2009 for far less than it was worth, about R70-million, after deciding that pay-TV was not its core focus.
There have also reportedly been disputes with shareholders.
Shenzhen Media, headed by Chinese businessman Xiao, has been running the business for the past year and says it has spent R100-million on operational costs.
Staff said that, until about two months ago, they were hard at work, producing premium content and finalising websites.
Signs of trouble emerged when several launch deadlines were not met, including one in June, not because of operational inefficiencies but because of what were called "problems at the top".
Super 5 Media's website still states that the company will launch a digital service this year.
"All our energy was focused on meeting the June deadline, then it was again extended to September without any valid reason: the staff were ready and prepared.
"This thing will never get off the ground," said a senior manager.
A month ago, Super5 Media's Internet connections and phone lines were cut off.
Insiders said electricity supply was sporadic and the water had been turned off.
"It's a rudderless ship with no one willing to take responsibility for the chaos.
"We knew something was not right," said one staff member. "The sale to the Chinese guys was dodgy."
The staff alleged that Xiao moved into an office boardroom three months ago with a bed, a fridge and a stove.
They accuse him of running the company like a "sweatshop" and allege that he has told them to "f**k off".
"They have ruined the lives of 40 top broadcasting professionals with their unethical business practice," said the manager.
