Political intervention helped force the settlement this week of a protracted share ownership dispute between two well-connected empowerment groups.
Former African National Congress comrades faced each other in a two-year battle over the disputed ownership of MTN (later M-Cell) shares valued at about R120-million.
A settlement agreement announced this week included payment by Safika Holdings to the Makana Trust of an undisclosed sum.
The Mail & Guardian has learned of intervention by prominent politicians to edge both parties towards agreement. Said a source: “The Office of the President was concerned and ANC secretary general Kgalema Mothlanthe was well aware of the negotiations.”
In terms of the settlement, Safika and Makana apologised to each other for past slurs. Said a joint statement: “The parties further regret that these public exchanges were characterised as a threat to [black] economic empowerment …”
Indeed, the dispute tarnished prominent empowerment figures and concerns. Safika was co-founded by Moss Ngoasheng, a former political prisoner and later President Thabo Mbeki’s economics adviser, and Vuli Cuba, an empowerment heavyweight.
Saki Macozoma, also a former prisoner and later Transnet boss, joined the company last year. Safika has since wrested control over empowerment giant Nail, which Macozoma now heads.
The Makana Trust was formed to look after the welfare of former political prisoners. Chaired by former Gauteng premier Tokyo Sexwale, former prisoners Soto Ndukwana and Peter-Paul Ngwenya are also prominent.
If this week’s kiss-and-make-up session is a boost to black economic empowerment, it also buries skeletons that, it could be argued, the public had a right to know about. In March the Johannesburg High Court, at Makana’s behest, ordered a statutory investigation into Safika’s affairs.
Allegations against Safika included not only that it had wrongfully appropriated Makana’s MTN equity, but also that Ngoasheng and Cuba had irregularly paid themselves R2-million each from Safika coffers to the detriment of other stakeholders. It appears this week’s settlement agreement put paid to that investigation as well.
The MTN shares were jointly acquired by Safika and Makana during 1999. When Makana decided to bid for the third cellphone licence the two groups agreed to place Makana’s share with Safika to avoid a conflict of interest. When Makana withdrew from the cell bid, Safika refused to reinstate Makana’s MTN equity.
From as far back as 2000 the matter has been aired in public mudslinging matches and has been the subject of an out-of-court settlement. A year ago Safika offered up to R12,5-million as settlement, but it was rejected as too low by Makana. While the amount of this week’s settlement is to be kept secret in terms of the agreement, a well-placed source said it was “many times” the earlier offer — at least a partial victory for Makana.
National Director of Public Prosecutions Bulelani Ngcuka, Minister of Public Enterprises Jeff Radebe and Minister in the Office of the President Essop Pahad helped make peace, a source said.
Motlanthe summoned both sides and held separate talks with them, after which he “played a monitoring role”. He met with Sexwale and Radebe, among others. Radebe’s involvement stemmed not from his ministerial post, but from the fact that he was a former prisoner.
In addition, there were calls from the President’s Office, which on several occasions wanted to know: “Seeing as you are all former political prisoners, why can’t you settle?” The source said he believed Pahad played a role in approaches by the President’s Office.
Ngcuka played a “significant role”. Like Radebe, his involvement was as a former prisoner rather than as an official — and also stemmed from his friendship with role-players on both sides. On the Makana side, the source said, Ngcuka was friendly with Ndukwana and Ngwenya, while on the Safika side he was friends with Ngoasheng and Macozoma. Ngcuka “was standing watching all his friends destroying each other” and decided to do something about it.