August 26 denies owning diamond concessions at the Skeleton Coast

BRIGADIER James Auala, CEO of the August 26 company, has denied that the military-owned outfit ever held diamond concessions in the Skeleton Coast Park, despite evidence that it held three such Exclusive Prospecting Licenses (EPLs) until as recently as June this year.

An official on Friday delivered an unsigned but stamped letter, issued under the name of Chief Executive Officer: August 26 Holding, in which the company also denied any knowledge of August 26 Holding Company taking over the financially struggling Tropitex garment factory. The letter also denied any “so-called deals” with the former United Africa Garment factory, denied any knowledge of diamond leases in the Skeleton Coast Park, and insisted that August 26 always acted according to “the Company Act (sic)”.The article, ‘Government bails out failing Windhoek garment factory’, published in this newspaper last week, was a “misleading and damaging article”, the letter stated, which the official insisted be published in full.August 26 is a wholly owned entity of the Ministry of Defence.The company was set up under the instructions of former President Sam Nujoma in 1999 in honour of Omgulumbashe Day (August 26).Shortly afterwards, August 26 bought the virtually bankrupt Windhoeker Maschinen Fabrik from the Koegl family.The Windhoeker Maschinen Fabrik, headed by MD Brigadier Mathias Shiweda, was subsequently made part of a portfolio of companies, which also includes Zebo Engineering.In his letter, Auala denied any knowledge of a Cabinet decision on June 28 (Cabinet Action Letter: Decision no.12 / 28.06.05/001) that his company was to take over struggling joint Namibian-Cuban uniform manufacturer Tropitex.”If Cabinet had decided as such, we are yet to be informed,” he wrote.”To date we know nothing about it and would not comment.”Auala also denied that August 26 ever intended acquiring the former United Africa Garments outfit from Ethiopian entrepreneur Hadis Tilahun.The “so-called deal” was supposed to have taken place two years ago “at undisclosed amount”, he wrote, accusing this reporter of deliberate misleading reporting.Brian Rubinstein, who recently joined the United Africa Group, confirmed that there had been discussions with August 26 two years ago on a possible take-over of United Africa Garment.The deal collapsed, he said, because August 26 could not or would not pay for the factory.The plant was then closed and the workers paid off, he said.As for Cabinet instructions to write off Tropitex’s N$3,5 million debt to the Development Bank of Namibia and pass it on to August 26, former MD David Imbili effectively confirmed this deal last week.Imbili, a former legal advisor to Old Mutual, only objected to a statement that Tropitex’s factory had been closed for the past few months.An inspection of the factory in Windhoek’s Lafrenz Industrial area showed that it was active again.Neighbouring businesses said it appeared shut a few months ago, but were unsure of the dates.Auala also denied that August 26 held any diamond Exclusive Prospecting Licenses (EPLs) in the Skeleton Coast.”August 26 Holding Company never had or has any diamond concessions at the Skeleton Coast (sic),” he wrote.”As matters stand right now, we don’t have any diamond EPLs anywhere in this country.”However, records with the Ministry of Mines and Energy show that EPL 3010, 3011, and 3043, situated about 20 kilometres north of the Ugab River inside the Skeleton Coast Park, were held by August 26 and-or Erastus Negonga, previously the Permanent Secretary of Defence.These licences were valid for three years and expired on June 11 this year, the records show.August 26 also previously owned offshore EPL 3009, situated about 50 km off Luederitz, which had either expired or had been sold to another operator, according to same Ministry records.The records also show that August 26 has applied for EPL 3431 in the Luederitz District for “Base and rare metals, Dimension Stone and Precious Metals”.This application is still pending.On an assertion that August 26 has never submitted any audited financial statements, Auala insisted that PriceWaterhouseCoopers had audited its books as recently as July this year.But no annual report or audited financial report has ever been submitted to Parliament for scrutiny since the company was formed in late 1999 on President Nujoma’s instructions, The Namibian has established from current and former MPs.* See also Readers’ Letters, page 11 John Grobler is a freelance journalist; 081 240 1587The letter also denied any “so-called deals” with the former United Africa Garment factory, denied any knowledge of diamond leases in the Skeleton Coast Park, and insisted that August 26 always acted according to “the Company Act (sic)”.The article, ‘Government bails out failing Windhoek garment factory’, published in this newspaper last week, was a “misleading and damaging article”, the letter stated, which the official insisted be published in full.August 26 is a wholly owned entity of the Ministry of Defence.The company was set up under the instructions of former President Sam Nujoma in 1999 in honour of Omgulumbashe Day (August 26).Shortly afterwards, August 26 bought the virtually bankrupt Windhoeker Maschinen Fabrik from the Koegl family.The Windhoeker Maschinen Fabrik, headed by MD Brigadier Mathias Shiweda, was subsequently made part of a portfolio of companies, which also includes Zebo Engineering.In his letter, Auala denied any knowledge of a Cabinet decision on June 28 (Cabinet Action Letter: Decision no.12 / 28.06.05/001) that his company was to take over struggling joint Namibian-Cuban uniform manufacturer Tropitex.”If Cabinet had decided as such, we are yet to be informed,” he wrote.”To date we know nothing about it and would not comment.”Auala also denied that August 26 ever intended acquiring the former United Africa Garments outfit from Ethiopian entrepreneur Hadis Tilahun.The “so-called deal” was supposed to have taken place two years ago “at undisclosed amount”, he wrote, accusing this reporter of deliberate misleading reporting.Brian Rubinstein, who recently joined the United Africa Group, confirmed that there had been discussions with August 26 two years ago on a possible take-over of United Africa Garment.The deal collapsed, he said, because August 26 could not or would not pay for the factory.The plant was then closed and the workers paid off, he said.As for Cabinet instructions to write off Tropitex’s N$3,5 million debt to the Development Bank of Namibia and pass it on to August 26, former MD David Imbili effectively confirmed this deal last week.Imbili, a former legal advisor to Old Mutual, only objected to a statement that Tropitex’s factory had been closed for the past few months.An inspection of the factory in Windhoek’s Lafrenz Industrial area showed that it was active again.Neighbouring businesses said it appeared shut a few months ago, but were unsure of the dates.Auala also denied that August 26 held any diamond Exclusive Prospecting Licenses (EPLs) in the Skeleton Coast.”August 26 Holding Company never had or has any diamond concessions at the Skeleton Coast (sic),” he wrote.”As matters stand right now, we don’t have any diamond EPLs anywhere in this country.”However, records with the Ministry of Mines and Energy show that EPL 3010, 3011, and 3043, situated about 20 kilometres north of the Ugab River inside the Skeleton Coast Park, were held by August 26 and-or Erastus Negonga, previously the Permanent Secretary of Defence.These licences were valid for three years and expired on June 11 this year, the records show.August 26 also previously owned offshore EPL 3009, situated about 50 km off Luederitz, which had either expired or had been sold to another operator, according to same Ministry records.The records also show that August 26 has applied for EPL 3431 in the Luederitz District for “Base and rare metals, Dimension Stone and Precious Metals”.This application is still pending.On an assertion that August 26 has never submitted any audited financial statements, Auala insisted that PriceWaterhouseCoopers had audited its books as recently as July this year.But no annual report or audited financial report has ever been submitted to Parliament for scrutiny since the company was formed in late 1999 on President Nujoma’s instructions, The Namibian has established from current and former MPs.* See also Readers’ Letters, page 11 John Grobler is a freelance journalist; 081 240 1587