IDC Confirms Mara Phones’ Plan to Buy Back KZN Smartphone Assembly Plant at Auction

IDC Confirms Mara Phones’ Plan to Buy Back KZN Smartphone Assembly Plant at Auction

  • The Industrial Development Corporation has confirmed that Mara phones want to buy back their smartphone assembly factory in KwaZulu-Natal at auction
  • Since its 2019 launch, the plant has received many forms of financial assistance from the government
  • The auction is an open sale, and other offers need to be considered before a decision can be reached

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DURBAN - The Industrial Development Corporation (IDC) has confirmed that Mara phones want to buy back their smartphone assembly factory in KwaZulu-Natal (KZN) after putting it up for auction earlier this month.

Since its 2019 launch, the plant has received many forms of financial assistance from the government, including becoming the preferred supplier of smartphones to government departments. After that, however, it faced bankruptcy and was put on auction.

According to BusinessInsider, Tshepo Ramodibe, the head of IDC's corporate affairs, said that Mara Phones have put in an offer for their former factory. However, the auction is an open sale, and other proposals need to be considered before reaching a decision.

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IDC, Mara Phones, smartphones, KZN, KwaZulu-Natal, Industrial Development Corporation, South Africa, business news, technology
Mara Phones has offered to buy back their former smartphone assembly plant. Image: Sharon Seretlo/Gallo Images via Getty Images
Source: Getty Images

Support received by Mara Phones

Mara Phones was chosen to be the first company considered whenever a government department needed a smartphone supplier. This agreement was set to last until 2026. The smartphone factory was also granted an R100 million tax break.

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The assembly plant also received a greenfields investment worth R350 million, and in turn, the government decided to forego the potential revenue. A condition of the investment was that the factory had to use new equipment to assemble the smartphones.

This was part of the Section 12I tax scheme, which no longer exists. The scheme allowed businesses to be paid back up to 55% of their investment into property and machinery via a tax deduction, according to MyBroadband.

South Africans react to the Mara Phones auction

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@fynwol asked:

"Is it a BEE or white-owned company? Tell us the truth please."

@MelokuhleNjalo believes:

"I think it was cursed by calling it "Mara", who wants a phone called "But" (direct translation), but what?"

@JasonHol84 remarked:

"I'm sure all the bosses got nice shiny cars and big bonuses."

@EllisMaytham shared:

"If an audit is done you will find that all the board increased their salaries by 150 %."

@Cliff_Hadji believes:

"South African manufacturers will never compete with cheap imports."

Mara Phones workers complain about bad working conditions and unpaid salaries

Speaking of Mara Phones, Briefly News previously reported that Mara Phones is in the middle of controversy since announcing that South Africa's first smartphone factory can no longer continue with operations and is going on auction.

Employees at the Dube Trade Port factory in KwaZulu-Natal have now come out with claims that the company did not keep many of its promises and they worked under deplorable conditions.

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The workers of Mara Phones said when they were first hired, the company promised to hire them as permanent employees after a three-month training contract had expired. The company also told them that during this training period, they would receive remuneration between R3 500 to R3 700.

Source: Briefly News

Authors:
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Claudia Gross (Editor) Claudia Gross holds an MA in Journalism from Stellenbosch University. She joined Briefly's Current Affairs desk in 2021. Claudia enjoys blending storytelling and journalism to bring unique angles to hard news. She looks forward to a storied journalistic career.