Explosive allegations over major South African solar company’s collapse

A shroud of uncertainty hangs over the Hohm Energy saga. The company filed for voluntary liquidation after allegedly entering business rescue in late July 2024.

However, two former Hohm Energy employees who provided information on the condition of anonymity have told MyBroadband that the renewable energy company never entered business rescue.

While there is evidence that the company entered business rescue on the Companies And Intellectual Property Commission (CIPC) database, MyBroadband has seen legal correspondence showing that a business rescue practitioner was never appointed.

Moreover, the CIPC database showed that Hohm Energy entered business rescue on 31 July 2024, meaning it may have only been eligible for liquidation much later.

According to the Companies Act, a company that has withdrawn or abandoned business rescue proceedings must wait at least three months before applying for liquidation.

Another point of contention is several staff members who said they weren’t paid for months.

Spark Energy Services CEO Franc Gray previously told MyBroadband that claims of former staff and contractors going unpaid are inaccurate. However, he reiterated that he was only recently appointed to Hohm Energy.

Our sources said both of these statements are false.

“Franc keeps on saying he only joined a month ago. He was on the executive committee as head of lending for a long time. Franc was on the payroll for at least a year at Hohm Energy,” our sources said.

They added that various contractors still have outstanding expense payments owed to them by Hohm Energy and that staff went unpaid for several months.

The sources claim that Spark Energy Services acted as the principal behind Hohm Energy, which included paying staff salaries.

They say Spark Energy Services has the money to pay outstanding salaries, contracts, and expense claims but is deliberately obstructing the course of justice.

They say the business rescue process was abused as a veil to obfuscate valid creditors’ claims.

For reference, Hohm Energy’s liquidation has come just months after it raised $8 million (then R152.5 million) through a record seed-funding round in February 2024.

Gray said there was a misunderstanding regarding the funding, saying Spark Energy Services raised the money over two and a half years.

He added that the important use of the funds was essentially an experiment to develop software to enable the solar marketplace, and a large portion of the funding went into developing it.

To this end, he said Hohm Energy was effectively an experiment to test and fine-tune the software. He added that Spark Energy Services views the experiment as a success.

Our sources described this claim as “garbage”.

“How can a company that’s been funded to the tune of $8 million be an experiment? It had 150 people at one stage on the payroll,” they said.

The sources say Gray pushed the money into Glint, a rent-to-own solar firm that was launched by Hohm Energy late last year, with the intention of relaunching it with the recently raised capital.

Gray’s LinkedIn page lists his current position as founder and CEO of Glint.

They also confirmed a claim that a previous source, who also wished to remain anonymous, had made.

“In about March, April, they stopped paying our expense claims. We then started asking about money and when we were getting our salaries,” the source and former Hohm Energy employee said.

“It was said that they were getting investors from overseas to invest in Hohm Energy, and in mid-July, they came back to us and said the money isn’t going to Hohm anymore.”

They added that Hohm Energy had indicated a willingness to pay staff and contractors until the end of June, with the possibility of extending the period to July if it remained operational.

“They forced us, within a couple of hours, to sign a mutual agreement of separation. Otherwise, you wouldn’t have received your money,” the source said.

“There was a timeline put on it for two to three hours.”

However, Gray denied that staff were given such a short timeline to sign the agreement.

Information from our new sources confirms the former contractors’ claims.

“Towards the end of February, the discussion started happening that we need to get additional funding. There was always this promise that it’s coming,” they said.

“Now we get to mid-July, and we haven’t been paid since April. The pipeline has dried up. There’s no work, and there’s no communication.”

They said Hohm Energy effectively offered staff “hush money” by promising to pay them for three months if they signed the agreement. Otherwise, they would get nothing.

“We weren’t paid our leave out. We weren’t paid severance,” they said.

MyBroadband contacted Gray for comment on the latest allegations and he did not provide feedback by publication.