R1-billion electronics factory failure is not minister’s husband’s fault – Yekani

Yekani has refuted a recent report by the Sunday Times which alleged that the closure of its R1-billion factory in East London was linked to communications minister Stella Ndabeni-Abrahams’ husband.

The report stated that after Yekani CEO Siphiwe Cele turned down an investment offer from Thato Abrahams, the company was unable to receive financial help from the government.

Yekani said it categorically refuted this statement and distanced itself from the claims made in the report.

The company said it does not blame Ndabeni-Abrahams and her husband – or anyone else – for its current financial issues.

“Yekani and its group CEO in particular take full responsibility for its current state and its priority remains to do everything in its power to protect and save the jobs of its employees,” Yekani said.

“The Group CEO of Yekani would like to thank the National Department of Trade and Industry (DTI), the Eastern Cape Office of the Premier, Eastern Cape Department of Economic Development, the East London Industrial Development Zone (IDZ) for all their support and willingness to assist in saving the jobs of our employees.”

Investment offer

The initial report stated that Cele, Abrahams, and the IDC arranged a meeting to discuss a possible investment in Yekani in April 2018. Abrahams reportedly sought to buy a majority stake in the company for R1 billion.

Stella Ndabeni-Abrahams was deputy communications minister at the time.

“Cele said that after Yekani turned down the overture from Abrahams, the Eastern Cape government failed to provide the financial help he requested,” the Sunday Times reported.

The minister’s spokesperson told the Sunday Times it was “disingenuous to blame the minister’s husband for the challenges faced by Yekani”.

Abrahams has also denied wanting to buy a stake in Yekani.

Financial trouble

Yekani’s electronics factory was opened by former Minister of Trade and Industry Rob Davies in East London in June 2018.

In January 2020, reports surfaced that the company was in big financial trouble, and liquidation processes had been initiated after Yekani was unable to make payments to Standard Bank for a large loan.

Workers at the factory had not been paid in five months, either, and the facility did not resume operations this year.

Yekani told MyBroadband that in the event it is put under final liquidation, approximately 500 direct jobs will be lost.

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R1-billion electronics factory failure is not minister’s husband’s fault – Yekani