A dispute between business partners has exposed the continued involvement of fugitive business person Billy Rautenbach in the massive exploitation of mineral resources in the Democratic Republic of Congo (DRC).
Rautenbach, who currently lives in Zimbabwe and the DRC, left South Africa in about October 2000 when a warrant for his arrest was issued on charges of fraud, theft and corruption relating to his control of the South African operation of the Hyundai Motor Corporation.
The warrant remains in force and indications are that preparations for an application to extradite Rautenbach are far advanced, though the National Prosecuting Authority would only issue a terse ”no comment” on the matter this week.
The controversial businessperson, whose expertise is in trucking and transport, had served from 1998 to March 2000 as the chief executive of Gecamines — a mining company owned by the DRC government — a position he obtained thanks to his high-level contacts in the Zimbabwean government.
Rautenbach’s appointment was allegedly negotiated directly between then president Laurent Kabila and Zimbabwean political heavyweight Emmerson Mnangagwa, whose brief was to secure mining concessions in the DRC as compensation for Zimbabwe’s military backing of Kabila.
But in 2000, after allegations that he was diverting substantial amounts of cobalt and copper for the benefit of his own company, Ridgepointe Overseas Development, Rautenbach was removed from his Gecamines position and Ridgepointe was stripped of its lucrative mining concessions.
Now a court case in the tax haven of the British Virgin Islands (BVI), where Ridgepointe and other Rautenbach companies are registered, has revealed how he has managed to reinsert himself as a major player on the DRC’s chaotic resource exploitation scene.
On January 6 the high court of the BVI issued a provisional liquidation order against another company in the Rautenbach network, Shaford Capital.
One James Anthony Tidmarsh, a Geneva-based lawyer, who claims to own a minority stake in Shaford, brought the application for the liquidation. According to an affidavit filed by Tidmarsh, Shaford owns 100% of the Congo Cobalt Corporation and 80% of another DRC company, Boss Mining.
Boss Mining, in turn, owns two lucrative DRC mining concessions, 19 and 21, as well as 50% of the Mukondo mine, regarded as the richest cobalt mine in the world.
According to Tidmarsh, Shaford was supposed to be a partnership in which the profits of the business would be distributed fairly among the shareholders according to their shareholding. He alleges, however, that Rautenbach is now denying the existence of the partnership and is abusing his majority position.
Rautenbach apparently has until January 23 to oppose the provisional liquidation, when the matter will be before the court again.
The stakes are high. A well placed business source claimed Rautenbach’s DRC profits — mainly from the Mukondo mine — were in the region of $18-million in 1994 and that he is currently making a profit of about $2-million a month.
According to several sources, Sabot International Transport — controlled by Rautenbach’s family — is one of the main hauliers trucking refined and partially refined cobalt and copper ore from the DRC to Johannesburg and Durban for sale and export.
A September 2004 report by the international resources watchdog, Global Witness, while not pointing fingers specifically at Rautenbach or any of his companies, reported widespread smuggling of ore and under-reporting of ore quality, leading to minimal benefits accruing to the DRC state and state-owned companies.
According to Global Witness: ”Only a minute fraction of trade in minerals is officially recorded: the vast majority of trade is illicit.”
An intelligence source, who has studied the cobalt trade from the DRC, told the Mail & Guardian that comparisons of official export figures from the DRC with more reliable import statistics from big buyers, such as China, suggested that unregistered or under-declared exports had risen dramatically between 2004 and 2005.
Meanwhile, the details concerning the assets owned by Shaford expose another level of fallout, involving Rautenbach, that forms an intriguing backdrop to his dispute with Tidmarsh.
Inquiries by the M&G show that the assets ascribed to Boss Mining were all once under the control of Rautenbach’s fellow Zimbabwean and sometime partner John Bredenkamp.
Bredenkamp is another businessperson linked both to the Zimbabwean political elite and the Zimbabwean intervention in the DRC. His entry into the mining business in DRC coincided more or less with Rautenbach’s exit.
Via the Kababankola Mining Company (KMC) — in which Bredenkamp’s Tremalt Ltd has an 80% share — Bredenkamp was awarded the rights to exploit concessions containing more than 2,7-million tons of copper and 325 000 tons of cobalt over 25 years — including Mukongo mine and concessions 19 and 21.
Rautenbach was allegedly offered an opportunity as a ”sleeping partner” in KMC, but refused and launched an international arbitration action to challenge the withdrawal of his concessions.
But, in April 2002 Rautenbach withdrew the application as a result of a settlement reached with the government of the DRC.
According to a source close to Bredenkamp, KMC was simply presented with an instruction from the DRC government to transfer its most valuable assets to Rautenbach’s Boss Mining, or face losing the lot.
Questions e-mailed to Rautenbach’s South African attorney, Nicoleen Fourie, were unanswered at the time of going to press.