LML4806 Assignment 1 (COMPLETE ANSWERS) Semester 2 2025 - DUE August 2025

Consolidated Investments Ltd is a company that invests in mining businesses in South Africa. Its business undertaking consists solely of its shareholdings in three companies, as follows: • It holds 100% of the ordinary shares in Reef Iron Ore Ltd. • It holds 58% of the ordinary shares in Creek Gold (Pty) Ltd. The remaining ordinary shares in Creek Gold (Pty) Ltd are held by various individual and institutional shareholders. • It holds 30% of the ordinary shares in Millenium Platinum Ltd. The remaining 70% of the ordinary shares in Millenium Platinum Ltd are held by Creek Gold (Pty) Ltd. With reference to the Companies Act 71 of 2008: Explain whether the companies in the scenario above constitute a group of companies. (5) Discuss the main consequences that flow from the existence of a group of companies. Briefly discuss the options that are available to the chairperson or presiding officer at a shareholders’ meeting when it is established that the meeting lacks a proper quorum for the meeting to begin or for a specific matter to be considered. (5) The board of directors of Isondo (Pty) Ltd is contemplating issuing shares to Varsha who is currently not a shareholder of the company. Varsha’s brother, Vishal, is a prescribed officer and shareholder of Isondo (Pty) Ltd. The board is concerned whether its decision to issue the shares to Varsha may contravene the provisions of the Companies Act 71 of 2008. Answer the following questions with reference to the Companies Act 71 of 2008 and the facts provided: Advise the board of directors of Isondo (Pty) Ltd whether it may proceed to issue the shares to Varsha without obtaining shareholder approval. (5) 1.2.2 Advise the board of directors on the meaning and rationale of pre-emptive rights, and on whether the current shareholders of Isondo (Pty) Ltd have any rights of pre-emption. (10) QUESTION 2 [20] 2.1 ABC Nominees (Pty) Ltd and Richmond Fund Managers Ltd hold 3% and 8% of the voting rights associated with the issued ordinary shares of Norfolk Resources Ltd, respectively. ABC Nominees (Pty) Ltd and Richmond Fund Managers Ltd believe that Norfolk Resources Ltd’s oil and gas business is failing due to the incompetence of the two executive directors, Lungile and Martin, who have been given the responsibility to manage that business. ABC Nominees (Pty) Ltd and Richmond Fund Managers Ltd have, therefore, submitted a written and signed demand for Norfolk Resources Ltd to hold a shareholders’ meeting to reconstitute its board