Stewart Bailey
Tokyo Sexwale is known in Johannesburg’s mining circles as the “rainmaker”; an affectionate nickname alluding to his success in bringing black empowerment in the resource sector into the commercial mainstream.
A previously sceptical investment community has applauded the achievements of Sexwale’s Mvelaphanda Mining, the black empowerment business vehicle he created in 1998. Before that, the outright failure of the industry’s first mining empowerment transaction the African Mining purchase of Anglo American’s stake in JCI left in its wake a hoard of avowed disbelievers.
But just how badly Minister of Safety and Security Steve Tshwete may have hurt the commercial ambitions of one of the country’s foremost black businessmen, only time will tell.
Tshwete last week accused Sexwale of plotting to overthrow President Thabo Mbeki; no proof was given to back up the allegations which appear to have come from a questionable source.
Sexwale is in esteemed company though. The same allegations were also leveled against black telecommunications magnate Cyril Ramaphosa and former Mpumalanga premier Matthews Phosa.
All three men were senior African National Congress politicians in the past and have impeccable political credentials. But all have made a successful transition to business circles.
But much of Sexwale’s initial commercial success was based on his political “struggle” credentials; he was a Soviet-trained member of the ANC and spent time on the infamous Robben Island with former president Nelson Mandela. His commitment to the ruling party has never been brought into question.
Despite this, however, there can be no question that Mvelaphanda would not have ascended the heights it has amassing R700-million in assets without the support of the president. Whether the president’s support was merely tacit or more direct is immaterial.
“If it were known that Mbeki didn’t favour Sexwale, Mvela would probably not have been able to do the deals it has done in the past,” says one banking source. “But the fact is that he has delivered and he is well respected in banking and mining circles … his business has picked up too much momentum for this to scare off any potential deals.”
Other sources within the ruling party are confident that the matter will be sorted out before long. If so, it will simply be chalked up to yet another petty scandal, which has eroded the credibility of the government.
If not, however, having enemies in the upper echelons of government may make further growth in South Africa’s diamond and energy sectors a little tricky for Mvela, given that the government guards the major growth avenues in these areas.
And in the case of Sexwale’s two biggest sponsors, Rembrandt and Anglo American, matters may not be much easier. Although both are enormously powerful in their own right, they would be reluctant to annoy the state, given that a large chunk of their operating assets lie in South Africa.
With the threat of new use-it-or-lose-it minerals legislation hanging over the head of South Africa’s largest mining companies, an association with a credible, well-connected black mining group is becoming a prerequisite.
Such personalities are in short supply and Sexwale is in demand, given that there will be a host of sought-after mineral rights that need to be protected, or are up for grabs.
The matter would undoubtedly have been dismissed as ludicrous had Mbeki not lent some credibility to the ruckus. The president has done little to pour cold water on the debacle and has tacitly backed Tshwete’s decision to have the matter investigated by the country’s National Intelligence Agency.
Sexwale himself has distanced himself from the claims, as have his so-called co-conspirators, but he may well count the cost of lost business opportunities if the matter is not speedily resolved.