Mining minister’s platinum shares: A R20m ‘conflict of interest’

When the new mineral resources minister, Ngoako Ramatlhodi, got involved in efforts to end the platinum sector strike this month, he did so with platinum shares worth millions in his portfolio.

Ramatlhodi, who was appointed to the position a month ago, holds a stake in Atlatsa Resources, a black economic empowerment (BEE) partner of platinum giant Anglo American Platinum (Amplats).

Almost immediately after being appointed last month, Ramatlhodi intervened in the 18-week-long platinum strike. He set up an intergovernmental task team to help the platinum producers and the Association of Mineworkers and Construction Union resolve the strike. But not long afterwards, Ramatlhodi announced he was “pulling back” from the negotiations.

The minister’s shares in the platinum belt imply a serious conflict of interest, regardless of whether he has acted on it. Asked how Ramatlhodi would manage this, his spokesperson, advocate Mahlodi Muofhe, gave contradictory responses.

Last Friday, Muofhe told amaBhungane that all of Ramatlhodi’s mining interests had already been placed in a blind trust. “So technically, he’s got no interest.”

‘Conflict of interest’
Four days later he backtracked, acknowledging that “a conflict of interest might exist”. He said the minister was therefore in the process of “relinquishing his [mining] shares in total”.

But Muofhe would not disclose the size of the Atlatsa stake – which amaBhungane estimates has a face value of R20-million – or what mining interests were held apart from this.

The provenance of Ramatlhodi’s Atlatsa shares is wrapped in some mystery.

In 2002, during Ramatlhodi’s second term as Limpopo premier, Amplats and a BEE consortium called Pelawan Investments formed a joint venture to develop a new platinum project in Limpopo.

In 2004, Pelawan took over Toronto-listed Anooraq Resources, which then became Amplats’s BEE partner in this and later platinum ventures. Anooraq was later renamed Atlatsa Resources.

This is the same company in which Ramatlhodi owns a stake. It claims to control “the third-largest platinum group metals resource base in South Africa”.

List of shareholders
A firm indication of Ramatlhodi’s involvement came in 2009, when Anooraq disclosed a list of Pelawan’s shareholders. Among these was a South African company called Legakabje Mining and Exploration, formed in 2001.

According to the disclosure, Legakabje’s shareholders included Ramatlhodi’s then-wife Ouma (28%) and lawyer Lassie Mahlangu (27%). Mahlangu was Ramatlhodi’s special adviser during the latter’s two terms as Limpopo premier, from 1994 to 2004.

In his Cabinet and parliamentary declarations since 2010, Ramatlhodi has declared that he holds an interest in the misspelled “Legakabiwe Mining”.

Although Ramatlhodi himself does not appear on paper as a Legakabje shareholder, Muofhe confirmed the stake: “[He] acquired the interest more than a decade ago, while in Limpopo.”

Atlatsa said it has no knowledge of Ngoako Ramatlhodi’s interest. This implies that Ramatlhodi’s platinum share – which he did not disclose in declarations prior to 2010 – was held in someone else’s name.

Muofhe said that Ouma Ramatlhodi, who was recently divorced from Ngoako, “has the shares”. He said: “The shares are part of an ongoing divorce settlement litigation.”

He would not answer specific questions about the size of Ngoako Ramatlhodi’s portion or why Ouma was listed on paper as the owner. She did not respond to questions.

No claim
This week Mahlangu, Ramatlhodi’s special adviser while he was premier, said that the 27% Legakabje stake in his name was held “by myself, on my own behalf”.

Ramatlhodi had no claim over his shares, he said.

Based on announcements by Anooraq/Atlatsa, which is now listed in Johannesburg, Toronto and New York, amaBhungane calculates that the Legakabje shares registered in Ouma’s name were worth about ­R40-million on January 31, when Atlatsa restructured.

Attorney Marothi Ledwaba, who consults for Ramatlhodi, said the couple was married in community of property.

If the Atlatsa stake is held jointly between the Ramatlhodis, this would imply that the minister’s stake was worth about R20-million in January.

Blind trust
Last Friday, Muofhe told amaBhungane that to shield Ngoako Ramatlhodi from any conflicts of interest, he had placed “all his mining interests” in a blind trust. He said this had already been set up and was being managed by Ledwaba.

Muofhe said: “I know it would be juicy to say the minister is compromised, that he is conflicted, but he is not.”

Four days later, Muofhe changed the explanation. He said that ­”immediately after appointment” as mineral resources minister in May, Ramatlhodi had instructed Ledwaba to place his mining interests into a blind trust. “[But] Mr Ledwaba advised the minister that given [his] recent appointment, a conflict of interest might exist, real or perceived.”

Ledwaba’s advice was that Ramatlhodi should sell his mining assets. Muofhe said: “The minister heeded the advice. Mr Ledwaba is currently effecting the transaction.”

This week Ledwaba confirmed this version, but said Ramatlhodi’s divestment could take a while. “It’s not an overnight process, because that’s not the only matter that I’m handling. He’ll have to stand in the queue like everyone else.”

‘Go and dig’
Ledwaba said he did not know what Ramatlhodi’s other mining interests are, and Muofhe would not answer questions about these. He said: “Go and dig, whatever you want.”

He said the minister had disclosed all of his business interests in his Cabinet and parliamentary declarations. But he declined to answer specific questions about each of the interests.

“The minister is open about the interest and has absolutely nothing to hide,” he said.

Among Ramatlhodi’s declared interests last year was Lithemba Investments, which is part of a BEE consortium in Anglo American Inyosi Coal.

Anglo American Inyosi has been earmarked to supply coal to Eskom’s Kusile power station, which is being constructed in Mpumalanga.

Muofhe would not discuss this, but Lithemba said that Ouma Ramatlhodi, not Ngoako, owned the shares.

The company was not able to provide the size of the stake in time for this article’s deadline.

Past brushes with controversy

In 2004, the now-defunct Scorpions embarked on a lengthy investigation into allegations that Ngoako Ramatlhodi had received kickbacks while Limpopo premier.

The unit traced money flows to two of Ramatlhodi’s properties from what it alleged was the black economic empowerment partner of the company that his administration had contracted to pay social grants in the province. Ramatlhodi denied wrongdoing, claiming these were loans.

At the end of 2008, acting prosecutions chief Mokotedi Mpshe quietly dropped the charges.

Separately, the Mail & Guardian previously exposed how in 1996, while premier Ramatlhodi had bought a farm through a front man, obscuring his own involvement.

The bond instalments were more than Ramatlhodi could afford, and the front man paid hundreds of thousands of rands on Ramatlhodi’s behalf.

Nevertheless, the bond went deeper into arrears.

The problem was solved in part when Amplats bought the farm in 1998. The front man was part of a consortium that subsequently won a casino licence from Ramatlhodi’s administration.

Ramatlhodi, who did not comment on the farm articles, subsequently filed a R3‑million defamation claim against the M&G, but did not pursue it.

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