THE owner of a hospitality company who suffered huge financial losses during the 2010 Fifa Soccer World Cup wants the Gauteng department of education to pay him R506-million.

Channon Merricks, the owner of Soweto Focus Point, a company that was meant to cater for soccer tourists, joined forces with 250 local businesses in each province to provide cleaning, security, transport, tours, laundry and catering services during last year's spectacle.

Investors were angry because they did not get the R2.9-million profit that was promised to them. The investors' combined investment with Merrick totalled R25-million. Most of them borrowed money and some took out second bonds to finance the initiative.

With the investment, he paid schools between R50,000 and R75,000 for accommodation, but no tourists stayed at the schools.

The company was selling a 22-day package for R35,000 per person excluding VAT.

The investors opened a case against him and it continues in the Johannesburg Commercial Crimes Court.

Merricks' company has since been liquidated, and he now wants the Gauteng department of education to compensate him.

He filed papers in the Johannesburg High Court last week, demanding R506-million from the education department.

He said he converted classrooms into accommodation facilities, spending about R7000 to renovate each classroom at several schools.

In court papers, Merricks claims he had an agreement with the department, but head of department Boy Ngobeni cancelled it on June 10.

However, education spokesman Charles Phahlane says the department is not to blame: "He has no case against us. He is welcome to go ahead with the case."

Phahlane said Merricks did not have an agreement with the department, but signed the contracts with school governing bodies.