A black female-owned company is suing the country’s wealthiest man, Johann Rupert’s firm for R29-million over an abrupt termination of a business contract.
Zandile Chiwanza’s company, Zaza Gas, hauled Remgro’s subsidiary Air Products, which manufactures, supplies and distributes various industrial and speciality gas products to the Southern African region, to court after it terminated its contract.
Air Products, the largest producer of industrial gases in southern Africa, contributes R476-million towards Remgro’s headline earnings, according to the company’s 2023 annual financial results.
The gas behemoth is worth about R10-billion.
Sunday World understands that Air Products terminated the Zaza Gas contract following allegations of theft.
However, Chiwanza has hit back, saying the allegations are unfounded.
Chiwanza in September 2018 scored the lucrative seven-year contract to start distributing and selling gas at a price set by Air Products from October 1, 2018.
Chiwanza is demanding R29-million for the loss of profits her company would have earned had the principal agreement run its course to October 2025.
She said R5-million would be for reputational damage.
On March 18, Air Products lawyers wrote to Zaza Gas’s legal representatives accusing Zaza Gas of stealing from them, saying the conduct constituted a repudiation of the principal agreement.
But Chiwanza denied both the theft and repudiating the principal agreement.
“The attempt at termination by the defendant … unequivocally shows that the defendant doesn’t deem itself bound to the distributor agreement and that it will no longer perform under the distributor agreement,” Zaza Gas’s lawyers wrote in response.
Chiwanza accused Air Products of defaming her company by distributing falsehoods by
advising clients of Zaza Gas and the gas community at large that the relationship between both companies has been terminated.
She said it was defamatory for Air Products to attribute the termination to fraud and theft allegedly committed by Zaza Gas.
“[Air Products] knows the allegations of theft/fraud to be false … notwithstanding the falseness of the allegation, continued to distribute the falsehoods about [Zaza Gas] with the intent to damage its reputation,” Chiwanza’s lawyers wrote.
Chiwanza told Sunday World that it took eight months for Air Products to identify the alleged stolen material.
“Why were Air Products dispatchers, security guards and our driver not arrested if they were involved in the theft? Why were we not consulted at the time of the incident?”
Chiwanza said the legal costs to fight the firm of Herculean proportions have taken a great financial toll on her family, pleading for lawyers to assist pro-bono.
Zaza Gas, which employed 40 people, generated revenue of between R4.5-million and R6-million a month and had over 5 000 customers.
According to court documents, the contract between Zaza Gas and Air Products was supposed to remain in force for the initial seven-year term and “continue thereafter until terminated by one party giving the other 12 months’ notice in writing, which notice will commence on the … anniversary of the commencement date”.
Responding to our query, Air Products told Sunday World that: “The matter you refer to is currently the subject of ongoing litigation between Air Products and Zaza Gas.
“Air Products is confident that it will be successful with this litigation, but it does limit our ability to respond to your query in any degree of detail.
“That said, we wish to place on record that Air Products respects and values its contractual relationships with all partners and stakeholders and is committed to the lawful and ethical enforcement of its rights in this regard.
“We do not practise or tolerate any form of unfair discrimination. We deny that our conduct and policies are in any way contradictory to these values in any of our dealings, including those with Zaza Gas,” said Air Products.
