The Financial Services Conduct Authority (FSCA) said it would defend any legal action against it by Sekunjalo Investment Holdings.
Sekunjalo intends to challenge an FSCA warrant that allowed it to search the company's offices and those of African Equity Empowerment Investment (AEEI) this week.
Sekunjalo chairman Iqbal Survé said the company would also launch an "extensive damages claim against the FSCA, its acting commissioner, as well as investigators that participated in the irregular raid".
He added: "The damages claim is yet to be fully assessed and calculated."
The FSCA said although it had not yet received a notice of the motion, it "will defend itself".
Survé said the court's granting of the warrant was "based on a gross misrepresentation of the facts".
He said "90% of the items requested [by the FSCA] are already in the public domain".
The FSCA raid came after it received allegations of prohibited trading practices and possible contraventions of the law.
Brandon Topham, divisional executive for investigations and enforcement at the FSCA, said it acted on a price manipulation complaint it received from the JSE in November 2018 with regard to trading of shares of companies related to Sekunjalo.
Survé previously said he had asked the FSCA to investigate trading in the shares of Ayo Technology Solutions and AEEI.
In April 2019, the JSE called for an external audit of Ayo's interim results. This followed revelations at an inquiry into affairs at the Public Investment Corporation (PIC). The PIC invested R4.3bn for a 29% stake in Ayo when the technology company listed in December 2017. Ayo denied the share price was inflated or that it had misrepresented its financial statements. The FSCA had also received a complaint from Survé to investigate the share trades but this was subsequent to the JSE complaint.
Transgression of section 80 of the Financial Markets Act provides for a maximum financial penalty of R50m or imprisonment of 10 years.
