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Trustco Group shares, which are majority owned by Namibian businessman Quinton van Rooyen and his family, have been suspended from trading on the Johannesburg Stock Exchange (JSE) after a Pretoria High Court dismissed its appeal against a decision by the local bourse.
The suspension, which comes nearly three months after the Pretoria High Court ruled that Trustco could not be suspended until the hearing of its review application in September, is the latest development in the legal battle between the JSE and Trustco after the former accused the Namibian firm of not properly complying with accounting standards.
Trustco’s CEO and majority owner Van Rooyen stated that the suspension was “unfortunate but necessary,” and that a court order was needed to override the “bona fide actions and representations of our independent board and auditors.”
“With this court order, we will comply to restate our financials as directed by the JSE,” he said, assuring investors that the trading suspension would be lifted once the group’s financial statement was restated.
Trustco, a diversified investment holding company controlled by the van Rooyen family, takes pride in investing in high-quality, world-class assets in the financial services and resources industries that generate long-term sustainable growth for stakeholders.
As a result of the recent suspension, the group’s share price fell 16.33 percent amid a heavy sell-off, bringing its market cap below R800 million ($45 million), while Van Rooyen’s 63.94-percent stake in the company dropped to R506 million ($28.4 million).
The legal battle between Trustco and the JSE began on Nov. 11, 2020, when the exchange’s authorities claimed that the company had not met the listing requirements for its 2019 annual financial statements and 2020 interim results.
As part of the allegations, the JSE accused Trustco of violating international accounting standards by misrepresenting the features of two loans and reclassifying land that it owns.
At the time, Trustco argued that only boards have the power to order corporations to amend their financial statements and insisted that all transactions had been “exactly accounted for, reported, and disclosed.”
