Questions raised over Adapt IT CEO Sbu Shabalala’s property deal

[Chris]

Questions raised over Adapt IT CEO Sbu Shabalala’s property deal

There are a number of Adapt IT shareholders who do not think it is good for CEO Sbu Shabalala to own the building his company uses for its head office as the tenant’s interests are secondary to the landlord’s interests.

This is the view of Huge Group CEO James Herbst, who has made an offer to shareholders to acquire Adapt IT through a share swop.

To fully understand the deal and the concerns from Herbst, it is of value to go back a few years.

 

[PCWARITM]

Contrest of inflict.

 

[C4Cat]

While shareholders might be worried about a conflict of interest, it's not illegal or anything like that. I would think it's actually quite common...

 

[Khahn]

The Huge CEO is not a happy camper because there is now a better offer on the table. Maybe he should think about the damage his public attacks are doing and what picture he is painting for his own potential future investors.

 

[Vie]

I find Huge Group's smearing campaign tactics in really bad taste. If I was an Adapt IT shareholder I would vote against any offer from them on principles alone.

 

[ToxicBunny]

Wow, can Huge Group come across as anymore bitter if they tried?

 

[C4Cat]

MyBroadband asked Adapt IT why Shabalala decided to acquire the Adapt IT Johannesburg Campus, but the company did not answer this question.

Really? I mean clearly it's a good investment, what other reason does he need?

 

[Illegal Allien]

Wow, can Huge Group come across as anymore bitter if they tried?

Exactly! they are giving these spurned bride vibes.

 

[Happy Days]

Any decent business owner will try to minimize their costs and owning the property in which your business is located makes financial sense.

In this case, by buying the property he knows he has a tenant for 13 years and that the rental covers all his costs. It doesn't matter to the tenant who the landlord is other than when renewal of lease comes up or if the lessor doesn't perform as per lease.

 

[Ancalagon]

Wow, Huge Group doesn't take rejection lightly it seems.

They are like that guy that can't take no for an answer, even when the girl tells him she prefers the other guy because he has a bigger d*ck

 

[ToxicBunny]

While shareholders might be worried about a conflict of interest, it's not illegal or anything like that. I would think it's actually quite common...

Why would the shareholders be worried about a conflict of interest?

So long as Sbu can show that he isn't overcharging AdaptIT for the premises over what they can get elsewhere then its ultimately a win-win situation for both parties. AdaptIT get a landlord that is intimately involved in their business and wants their business to succeed so that he can continue getting rent for the property and the tenant is directly invested in the property they lease as well.

 

[ponder]

Any decent business owner will try to minimize their costs and owning the property in which your business is located makes financial sense.

Is the CEO the business owner?

 

[Happy Days]

Is the CEO the business owner?

Not in this case. The only issue would be if he influenced the decision making w.r.t the lease terms. With any commercial property that built to spec, the owner wants to lock the tenant into a lease that will allow them to recover the building cost by the end of the lease.

 

[ToxicBunny]

Is the CEO the business owner?

Well it does look as if he is the largest shareholder in the company at around 10%... He is also the founder of the business.