Count Riccardo Agusta the Italian helicopter company heir and a top investor in South Africa sees no wrong in his relationship with mafia man Vito Palazzolo
Stefaans Brmmer
Count Riccardo “Rocky” Agusta has had a hectic decade. As a racing driver he endured Le Mans and Daytona. As an entrepreneur he invested around the globe. As the heir of a disputed military chopper fortune he fought “World War III” with his stepmother.
Now life is more tranquil. He has retired from racing; settled with his stepmom; even been saved a fortune by her subsequent and untimely death.
He is resident in Monaco, but five months of the year Agusta (50) enjoys the tranquillity at La Grande Provene, his 18th-century wine estate at the heart of picturesque Franschhoek valley in the Cape. Here he oversees the production of Agusta wines, a line that includes the renowned Angels’ Tears.
Across the road he bottles La Vie de Luc mineral water at La Terra de Luc, the farm he bought 18 months ago from Vito Palazzolo. He runs the operation with the help of Palazzolo, the friend he protests is no mafioso. (Palazzolo, a Sicilian-born former Swiss banker, has been convicted, indicted or wanted in Switzerland, the United States and Italy. This stems in part from his role with the “Pizza Connection”, a Mafia drug ring bust in the US and Italy. South Africa is prosecuting him for alleged immigration fraud.)
Agusta must be one of the larger private foreign investors in South Africa. Apart from his 160ha Franschhoek domain, he owns 450ha at Plettenberg Bay to be developed as an upmarket golfing estate, and another 1 000ha for development near George.
Agusta says he has faith in the country, but does not enjoy controversy such as the outspoken reaction of the Nelson Mandela Children’s Fund a fortnight ago when it was made aware of Palazzolo’s relation to La Vie de Luc mineral water. Bottles of La Vie have sported the children’s fund logo since May in terms of a deal where 5c of every bottle sold would be donated to the fund.
Achmat Dangor, CEO of the fund, said at the time that the fund did not want to be tied to any party “if it has links in any way with people with dubious backgrounds”, and that the use of the logo was not authorised by the fund.
Last Friday Dangor wrote to Agusta, saying the fund “does not wish to make any judgements about the standing of your company, but we need to protect our stature and image … We therefore appeal to you to withdraw all your bottles featuring the Nelson Mandela Children’s Fund registered trademark, immediately.”
Agusta said this week: “My investment at this moment in the country is averaging around $20-million [R160-million] and it is not a joke, so it means I believe in the country. [But] it will take me a sec to sell everything and find another country to invest. I am not here to invest and to get beaten.”
Both sides have a leg to stand on. La Vie de Luc has what appears on the face of it to be a valid contract to use the logo and would have had no reason to doubt its validity. The children’s fund, however, may not have consciously approved the deal with La Vie de Luc, since the contract was signed not by the fund, but on its behalf by outside fund-raising agency Edusaf Projects. The fund earlier “outsourced” some of its activities and authority to Edusaf.
Agusta first visited Southern Africa in 1991. He says he read a Wilbur Smith book that referred to the hero “drinking [Cape] wine with this beautiful lady with a belly like a leopard”, so his trip had to include a visit to the Cape winelands. He was smitten and months later bought La Provene. In 1997 he bought the neighbouring Haute Provene and joined both into the current Grande Provene.
Where exactly the working relationship with Palazzolo started is unclear. Agusta says that in 1999 he wanted to expand his wine operation and when Palazzolo’s next-door farm went on sale it presented an ideal opportunity. Before that there was only occasional contact as between neighbours. When Agusta bought La Terra de Luc for a reported R30-million late that year, he asked Palazzolo to stay on as consultant “to help in all the handover”.
Agusta says he is happy with the services of Palazzolo, whom he calls “my friend in the first and the last place”. He has in mind to extend Palazzolo’s consultancy. (The consultancy contract, formally between Palazzolo and both La Terra and La Vie de Luc, is terminable at the earliest within three years of November 1999, when it was signed. It stipulates that Palazzolo be paid R10 000 a month and retain the use of Terra de Luc manor house. He was to perform a range of services, including help develop the business and assist technically.)
A prominent Franschhoek resident claims the relationship started earlier. In early 1999, he says, Agusta’s wine business was in trouble, due in part to the freak electrocution death of John Goschen, the Agusta winemaker. Agusta was going through a rough patch due in part to the inheritance battle. Then already Palazzolo “stepped in” to help with Agusta’s business.
The battle with Agusta’s stepmother, Contessa Francesca Vacca, raged across continents for 11 years. At stake was the fortune accumulated by his father, Corrado, and grandfather, Giovanni.
The grandfather founded an aircraft construction company in 1907, and became a large World War I supplier. Corrado helped build the company into one of the world’s top helicopter manufacturers it grew though the supply of military choppers to the US in Vietnam and to other mega-clients like the shah of Iran.
Agusta Helicopters has seen its fair share of scandal, including recently in South Africa, which has ordered 30 Agusta A109 choppers as part of its controversial multibillion-rand defence procurement package. Agusta says helped set up the A109 assembly line back in the 1970s, but that he cannot talk about the arms scandal since his father sold the company to the Italian state in the mid-1980s.
Count Corrado, by then separated from former model Contessa Francesca, died of cancer in 1989. Says Agusta: “When my father died she decided to declare the third world war on me … Because she was badly advised by people around her, she was convinced that I had inherited a fortune that was absurd, and you know that when people consider your fortune at least 10 times what is real, you cannot even try to make a settlement.”
Francesca firmly believed the true size of the inheritance had been hidden from her. She employed sleuths and lawyers on several continents to track down and claim her stake. Court battles raged in Milan, New York and Zurich. One of her former associates says the contessa believed the fortune was worth about $1-billion (R8-billion), but that they only “caught glimpses of $200-million [R1,6-billion]”.
In November last year Agusta and his stepmother finally settled out of court. He agreed, he said, to pay her about 8,5-billion lira (about R30-million) in cash and another 15-billion lira (about R53-million) in twice-yearly instalments over the course of 13 years. It has been reported that she was also allowed to keep properties including a 40-room cliff-top villa at the Italian resort town of Portofino.
The villa was originally built for Lord Caernarvon, discoverer of Tutankhamen’s tomb, in 1874. When Francesca disappeared from the villa on January 8, two months after the settlement with Agusta, there was talk of the “pharaoh’s curse”.
When her broken body was found two weeks later, hundreds of kilometres away on the French coast, the Italian media went on a reporting frenzy that included allegations the large inheritance had motivated her murder. Italian investigators say three possibilities remain: suicide (as she was depressed and drunk), accident (as she could have plunged from the cliff by the villa) and murder.
Agusta says he was the last to speak to her, by phone, the afternoon of her disappearance. She had “come back to me as a friend” and complained about her companions. “She was very upset and depressed and also she was a little bit maybe under the influence of alcohol.”
The contessa’s death has relieved Agusta of the obligation to pay the 15-billion lira in instalments. He insists: “I will not pay [but] if the poor lady was alive … I would have been much more happy, since she died such a bad death.”
Now Agusta’s remaining hassle seems to be his relationship with Palazzolo. Hubert Achermann, a managing partner of mega-consulting firm KPMG in Switzerland, last week confirmed that he resigned in April last year from the board of La Grande Provene mainly because of Palazzolo’s involvement in the business or, as he put it, “mainly due to this funny guy sitting next door”.
KPMG Cape Town partner Roland Hudson-Bennet confirmed the company also resigned as auditors around the same time. He would not give the reason, citing client confidentiality.
But Agusta still defends his relationship with Palazzolo, saying he deems the man innocent until proven guilty. Asked about Palazzolo’s past convictions, he says that when he does business, “I normally don’t care about if there is a skeleton in the closet.”