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Mail & Guardian
31-05-2025
- Business
- Mail & Guardian
South African firms suspect UAE companies may have obtained military intellectual property
(Wikimedia Commons) Defence company The investigation focuses on employees of at least two defence firms who are suspected of passing military intellectual property (IP) to UAE state-owned companies. 'Paramount Group is cooperating fully with the The OCCRP obtained two briefings from the SIU, which focus mainly on allegations that employees of a second company, One of the documents obtained by the OCCRP was a 2023 presentation to parliament's standing committee on public accounts (Scopa), while the other was a PowerPoint briefing of the SIU's findings in 2025. The SIU declined to answer detailed questions about its investigation, saying that it 'reports only to the president and parliament'. 'Therefore, we cannot make public statements or give comments on ongoing investigations,' a spokesperson added in an email. 'However, it is important to note that evidence indicating criminal conduct has been referred to the National Prosecuting Authority.' Paramount has also launched its own internal investigation to determine whether employees provided intellectual property to a UAE company after a joint venture deal that eventually collapsed. 'Pattern of misconduct' Founded in South Africa in the early 1990s, Paramount is now headquartered in the UAE. The company filed for bankruptcy last year after losing an arbitration case in London against Abu Dhabi Autonomous Systems Investments Company (Adasi). Paramount's problems began in 2016 when one of its subsidiaries, Riverston Enterprises Limited, entered into a joint venture deal with Adasi. The joint venture fell apart after Adasi was taken over by another UAE state-owned firm called Edge Group, according to internal records and court documents obtained by the OCCRP. As part of the agreement to set up the joint venture, Adasi had provided Paramount with a loan of $150 million, an internal document from Edge shows. That money was meant to cover the costs of creating the joint venture company in the UAE, and transferring the intellectual property behind Paramount's reconnaissance plane, which the new company would transform into an armed strike aircraft called the MWARI. Both Adasi and Paramount agree that the intellectual property was never transferred to the UAE as planned. Now Paramount says it is no longer legally obligated to transfer the intellectual property, but Adasi says it has the rights to the information under the arbitration ruling. Neither the Edge Group, which owns Adasi, nor its public relations representatives responded to requests for comment. But a legal document filed by Adasi in Paramount's bankruptcy case provides insight into its position. In the legal filing, Adasi argued that Paramount's bankruptcy case was a stall tactic meant to give the company time to move its assets so they could not be transferred. Those included the 'potentially valuable intellectual property assets', which had been 'granted to Adasi'. The filing states that Paramount said it declared bankruptcy because it could not afford to pay the penalty ordered by the arbitration board. That penalty totalled $230 million, and included the $150 million that was to cover the transfer of intellectual property for its aircraft to the UAE. Paramount's South African lawyer, Lauth, told the OCCRP that the intellectual property of the MWARI aircraft 'remains wholly governed by South African law and has not been externalised to the UAE, Adasi, EDGE or any related entity'. Intellectual property used exclusively for military purposes is often not patented, because doing so would make the designs accessible to competitors and hostile actors. Instead, such property is considered a 'sovereign asset' overseen by the government, according to experts including Vanessa du Toit who previously ran the National Conventional Arms Control Committee, which oversees South Africa's military technology and arms exports. Lauth said the research and design behind the MWARI was 'not the only intellectual property that was allegedly targeted'. 'Our clients have identified a broader pattern of misconduct involving multiple Paramount-developed platforms,' she told the OCCRP. In a leaked document from the arbitration case, Paramount founder Ivor Ichikowitz said the deal was based on Adasi ordering 5 000 armoured vehicles, and 6 000 'loitering munitions', which are drones built to explode on impact. In the end, only four trucks and 500 drones were ordered by the company. 'In hindsight, it now appears that the presentations and solutions we presented may have been used by … staff to benchmark other defence projects underway at the time in other organisations in the UAE,' Ichikowitz said, according to a leaked affidavit from the arbitration case. Ichikowitz declined to provide comment to reporters. Martie Baumgardt, a senior executive, told the OCCRP the firm is also carrying out its own internal investigation. She said the company is looking into the 'possible theft of IP from Paramount by individuals who left the company, which may conceivably have ended up in the UAE'. According to Baumgardt, after the joint venture with the UAE partner broke down, 45 Paramount employees joined Edge Group companies. A leaked document from Paramount's internal investigation also alleges that 57 laptops and 10 hard drives were stolen from 2016 — the year Paramount's subsidiary entered the joint venture with Adasi — to 2024, when it lost the arbitration case. The Denel affair Meanwhile, the Denel case dates back to 2012, when South Africa's state-owned arms manufacturer entered into a joint venture with a UAE firm, then known as Tawazun Operation Company LLC. Under the agreement, the two firms established a new company based in the UAE called Tawazun Dynamics LLC. According to the 2023 briefing to Scopa, the joint venture was initially intended to manufacture and supply Denel missiles to the UAE Air Force, and 'future customers'. At first, the partnership appeared to be a success. Other deals were soon struck, in which Denel would also provide a UAE defence company called NIMR Automotive LLC with RG35 Military Vehicle IP and hardware. But the relationship began to sour. 'It is alleged that the IP belonging to the institution was misappropriated in cohesive criminal conduct to abet foreign state companies,' the SIU said in its 2023 briefing, referring to allegations brought by Denel. In its investigation, the SIU found evidence suggesting that Denel employees may have accessed intellectual property without permission. In one instance, SIU investigators found that 'data packs' relating to missile technology had been downloaded from Denel's system after a request from Halcon, another arms company owned by Edge Group, according to the 2023 briefing. That briefing also outlines a case reported by Denel to the SIU, which involved intellectual property for a military vehicle. The SIU noted that contracts had been signed with NIMR by a Denel employee who was not authorised to do so. 'This official later resigned and informed Denel that he was offered a senior position by NIMR,' the briefing says. Denel reported that it had later received a letter from the chief executive of NIMR, who had previously worked for Denel, demanding intellectual property for a military vehicle. The joint venture company Tawazun Dynamics is today called Al Tariq and — like NIMR — it is owned by Edge Group, which did not respond to questions about alleged attempts to transfer intellectual property from Denel. The NIMR chief executive was one of more than 300 Denel staff who left the company and went to work in the UAE's arms sector, according to a summary of a South African parliamentary discussion in February. Gloria Serobe, chair of the Denel board, told the parliamentary committee that so many Denel employees had left for UAE firms that 'board meetings were done in Afrikaans'. This story was first published by the Organised Crime and Corruption Reporting Project (OCCRP).
Yahoo
21-05-2025
- Business
- Yahoo
Paramount Group CFO, GC resign; office REIT launches strategic review
This story was originally published on CFO Dive. To receive daily news and insights, subscribe to our free daily CFO Dive newsletter. Paramount Group CFO, Treasurer and Chief Operating Officer Wilbur Paes and General Counsel Gage Johnson stepped down from their roles at the company and its affiliates on May 15, the real estate investment trust said in a Monday securities filing. The real estate investment trust, which owns office properties in New York and San Francisco, appointed its SVP and Chief Accounting Officer Ermelinda Berberi to the role of CFO and treasurer and tapped its Vice President, Counsel, Timothy Dembo for the role of SVP, GC and secretary, according to a Monday press release. All appointments were effective May 15. The REIT simultaneously announced its board has initiated 'a review and evaluation of strategic alternatives to maximize shareholder value.' The review comes as the company's 'board and management team remain focused on closing the persistent gap between the company's public market valuation and our assessment of its intrinsic value,' CEO and Chairman and President Albert Behler said in a statement included in the release. The New York City-based REIT, a major office landlord in San Francisco and New York, is evaluating 'a comprehensive range of strategic alternatives' as part of its review, Behler said Monday in his statement. That could include a potential sale of the company or a joint venture, The Wall Street Journal reported Monday. Paramount Group did not immediately respond to requests for comment. The REIT has engaged Bank of America Securities to serve as its financial advisor and tapped Latham & Watkins LLP to act as its legal advisor, working in tandem with a 'transaction committee' comprised of independent directors to review the company's options, according to the Monday release.'There is no set timetable for completing the strategic review and no assurance can be given as to its outcome,' Paramount said of the review in its Monday release. The abrupt executive departures and review are the latest signs of struggle at the real estate trust, which has a business model that is focused on providing office spaces for the financial, media and professional services industries, according to its website. Both the review and its two recent executive appointments come as the REIT looks to regain shareholder confidence as it continues to navigate economic headwinds, including weakness in its San Franscisco portfolio, looming debt maturities and challenges stemming from the broader office sector that is still struggling to recover from the shift toward remote work. The firm has drawn headlines regarding previously undisclosed payments to its CEO, Behler who received at least $4 million in payments for personal expenses and business interests, The Wall Street Journal reported in April. The REIT has also struggled to retain shareholder trust and confidence amid continuing economic pressure. Paramount Group reported strong leasing activity for its most recent quarter ending Mar. 31 — leasing 283,874 square feet, its strongest quarter since Q1 2021, according to an earnings call transcript. However, its total debt inched upwards to $5.4 billion for the quarter, with 42% of its debt set to mature in 2026, according to its earnings presentation. Paramount also reported a net loss of $10 million for the quarter, compared to net income of $9.9 million for the prior year period, according to its earnings results. Paramount's incoming CFO Berberi has served as the company's CAO since March 2017, joining the company in 2016 as its SVP of finance, according to her LinkedIn profile. Prior to Paramount Group, Berberi served as a senior manager at Big Four firm Deloitte. The company did not detail Berberi's compensation as CFO in its Monday filing. For the full-year 2024, her predecessor Paes received total compensation of approximately $2.4 million in his role as CFO, COO and treasurer, comprised of an annual base salary of $670,000, stock awards with a value of $1.7 million, and other compensation of $52,080, according to Paramount's latest proxy statement filed in April. A 10-year veteran of the REIT, Paes served a five-year term as Paramount's CFO, and was appointed to the dual role of CFO and COO in February 2021, according to his LinkedIn profile. Prior to succeeding Johnson as GC, Dembo served as VP, counsel for the REIT beginning in 2022, according to the Monday press release. He joined the company in 2020 from Wilkie Farr & Gallagher LLP, where he previously served as an associate, according to his LinkedIn profile. Johnson, a 16-year alum of the company, received $955,419 in total compensation for 2024 as its GC, according to the proxy.
Yahoo
20-05-2025
- Business
- Yahoo
Paramount Group raised to buy at Evercore ISI
-- Evercore ISI upgraded Paramount Group (NYSE:PGRE) to Outperform following the company's announcement that it is exploring strategic alternatives, a move the firm believes creates a compelling risk-reward opportunity. On Monday, Paramount Group said its board had formed a committee to explore options and hired BofA to assist in the process. Simultaneously, longtime CFO and COO Wilbur Paes and General Counsel Gage Johnson stepped down, with internal candidates being the replacements. Evercore ISI sees these developments as signaling the potential for a company sale, writing that 'it is more likely than not that the company is exploring a sale.' The firm conducted a detailed asset-by-asset net asset value (NAV) analysis, estimating a range between $8.03 and $12.75 per share, with a midpoint of $10.26. Still, analysts cautioned that 'we don't believe an entity level buyer would actually pay 'NAV' as there are risks attached such as taking a few years to fully stabilize the portfolio.' Evercore ISI derived a new price target of $8 per share using a blend of relative valuation and discounted cash flow analysis. This is said to imply 48% upside from after Monday's 13.2% gain. 'This represents a 3:1 risk/reward scenario,' the firm wrote. Even so, Evercore's upgrade of the stock comes with caveats. 'There is a chance that the company does not complete or accept an offer but rather stays the course, which clearly would not be the optimal outcome for shareholders,' the firm warned, noting Paramount previously rejected a $12 per share offer in early 2022. Related articles Paramount Group raised to buy at Evercore ISI Evercore ISI remains bullish on Dell after annual user conference Elon Musk says Tesla is already back Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
19-05-2025
- Business
- Bloomberg
Stock Movers: Novavax, Paramount, Shake Shack
On this episode of Stock Movers: Listen for comprehensive cross-platform coverage of the US market close as heard on Bloomberg Television, Bloomberg Radio, and YouTube with Romaine Bostick, Alix Steel, Scarlet Fu, Carol Massar and Tim Stenovec. - Novavax (NVAX) shares jumped as US regulators fully approved its Covid vaccine, easing investors' concerns after the clearance was delayed and US Health and Human Services Secretary Robert F. Kennedy Jr. raised doubts about its efficacy. The US Food and Drug Administration cleared the shot for adults 65 and older and those ages 12 to 64 who have at least one underlying condition that puts them at high risk if they get the virus. The approval is a positive sign for other vaccine makers. It's been unclear how their shots will fare under the leadership of Kennedy, a longtime vaccine critic. - Paramount Group (PGRE) shares soared in trading today, in part on the word that the company's board is initiative a review and evaluation of strategic alternatives and named a new CFO. - Shake Shack (SHAK) shares slumped today after TD Cown cut the recommendation on the burger fast food chain to hold from buy, citing an already high valuation amid a challenging consumer spending backdrop. 'SHAK now trades in excess of the 3Y avg FY2 EV/EBITDA, leading us to believe the challenged restaurant spending backdrop limits further multiple expansion, particularly in the crowded burger category where the concept lacks category leadership,' analyst Andrew Charles wrote in a note.
Wall Street Journal
19-05-2025
- Business
- Wall Street Journal
Major Office Landlord Is Exploring a Sale of the Company
Paramount Group PGRE 14.33%increase; green up pointing triangle, a major New York City and San Francisco office landlord, is exploring strategic alternatives for its business, which could entail an outright sale of the company. The company said Monday that it has enlisted Bank of America as financial adviser and the law firm Latham & Watkins to conduct a strategic review with 'no set timetable' and 'no assurance' of its outcome. It could end in anything from a sale of the entire company, parts of it, a recapitalization or a joint venture with another entity.
