AFRICAN DAWN ANNUAL REPORT 2019 3 Our past African Dawn Capital Limited (the “Company” or “Afdawn”) was founded in 1998 as a micro finance business. Following its listing on the AltX in 2004, it grew into a niche finance provider specialising in micro finance and structured property finance. The Company wanted to reposition itself as a listed venture capital vehicle. Due to a long outstanding SARS liability that could not reach settlement on time and the failure of the Dzothe Transaction, this strategy was abandoned. All non-core assets were sold and eventually a SARS settlement was reached in December 2017. Our journey during the past year After the SARS settlement was concluded in December 2017 the key focus was to adhere to the repayment terms of the agreement otherwise the whole settlement was at risk. We could not attract enough external funding during this period and were dependent on director loans to ensure we don’t breach the terms of the SARS settlement agreement. The settlement amount was settled in full by February 2019. In August 2018 we were able to announce the terms of a Specific Issue of Shares for a cash consideration of R9,38million to Arvesco ( the “Arvesco Transaction”). The Arvesco Transaction was approved by shareholders in early December 2018 and R5million of the proceeds was used to recapitalise Elite Group. The Arvesco Transaction will give the Group access to networks for funding, distribution channels and other future opportunities. Where are we now We have two operational entities, Elite Group, our lending platform, and Yue Diligence, who helps entrepreneurs to identify growth gaps to remedy to ensure a stable platform from which to launch growth. The strategy is to leverage the lending platform of Elite through access to lower cost distribution channels other than a traditional branch network and to broaden the product range. During this period, we had to tread carefully to ensure we cross this difficult hurdle to enable the Group to access the capital markets again. Our key objective for the near term • To reposition Elite to leverage its lending platform • To roll out the YueDiligence platform to entrepreneurs, funders and consultants and other stakeholders to ensure a growing and sustainable SME market after further development work was done during the past year.
AFDAWN AR FINAL 2019
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