Banks, which have been exposed in a major report as apparently benefiting from stratospheric fees, can expect to soon be tackled by an independent adjudicator. The banking industry can expect the same kind of shake-up that independent Pension Funds Adjudicator Vuyani Ngalwana has brought to the life industry.
If there’s a five-letter expletive in Cape Town these days, it’s Eskom. With just one exception, Eskom’s executive directors, who earned R73-million last year, are the highest paid in the country. The city has racked up losses of hundreds of millions of rands in power cuts and load shedding and faces a bleak winter as the country runs out of electricity capacity.
Think of every building, house, shack and pondok in the country. Now think of the same buildings, houses, shacks and pondoks, but each with a solar heater on the roof. It seems an impossible dream, yet, experts say, every household could have had a free solar power unit on its roof if public money had been spent on solar rather than nuclear power.
It’s been the season for earthquakes. First Mozambique and much of Southern Africa was hit by an uncharacteristic once-in-100-years event. Then there has been the seismic activity around fuel and petrochemical giant Sasol, which saw R25-billion wiped off its market capitalisation in a five-day period.
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/ 13 February 2006
South Africa is going Brazilian, joining a worldwide scramble to catch up with the South American country’s successful use of the green fuel ethanol as its primary source of liquid energy. Ethanol, which has benefited in recent years from dramatic technological advances, is now seen internationally as a key renewable energy source.
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/ 8 February 2006
While Naspers executives have been at the ramparts fending off a hostile bid, chief executive Koos Bekker has struck a deal with Sanlam, making him a controlling force in the R40-billion giant for an investment of just R67,5-million. Bekker recently sold R75-million of Naspers shares to pay Sanlam for a 25% stake in Wheatfields, a new entity that owns high-voting Naspers A shares.
Some of the South Africa’s biggest companies and best-known brands find themselves at odds with the government as it pushes ahead with economic reforms designed to boost growth through increasing efficiency and competition. Both South African and multinational companies have felt the chillier wind blowing from Pretoria.
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/ 23 December 2005
The government has tabled a special black economic empowerment (BEE) deal for foreign multinationals that exempts them from bringing in black shareholders. The latest BEE codes of conduct, released recently, say that multi-nationals operating in South Africa can sidestep BEE ownership regulations if they can show that implementing black shareholding will cause substantial commercial harm.
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/ 9 December 2005
Western Areas’ new executive chair-person, Gill Marcus, on Monday swapped her trademark kaftan for an overall and took an extensive tour of the company’s South Deep mine near Westonaria, south of Johannesburg. Western Areas, which has a 50% interest in South Deep, can be thought of as more of a conundrum than a company.
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/ 6 December 2005
The government is forging ahead with developing mini-reactor nuclear technology despite the fact that cost estimates have exploded, foreign and local investors have either quit or appear to be distancing themselves from the project and new investors are conspicuous by their absence.
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/ 21 November 2005
Bigger even than Old Mutual, the government-controlled Public Investment Corporation now owns more than one in every 10 shares on the JSE. It has R460-billion in assets under management and is the country’s largest single investor. Yet its investment policies, largely in the "hot" areas of bonds and blue chip equities, appear conservative, to say the least.
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/ 7 November 2005
In a globalising world, one is increasingly likely to be prosecuted at home for crimes committed abroad. Sexual tourists, for example, may find themselves in huge trouble once they have returned home for offences committed while on holiday. Likewise, soldiers of fortune may face prosecution at home for their activities, for example, as hired guns in Iraq.
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/ 28 October 2005
Banking boss Jacko Maree of Standard Bank was the country’s highest paid chief executive last year with total earnings of R38,9-million. Human capital management company Mabili says in its annual report on directors’ remuneration that banking bosses earn top dollar, the financial sector proving to be lucrative for both executive and non-executive directors.
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/ 28 October 2005
Fill up with Penuell, Khaya and Phuthuma. This week, the <i>Mail & Guardian</i> reveals for the first time the big empowerment stakes at issue in the Uhambo deal — the proposed merger of Engen and Sasol’s fuels business — which show that the benefits to accrue to Penuell Maduna, Khaya Ngqula and Phuthuma Nhleko will make them industry giants.
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/ 25 October 2005
"Having recently moved from Leafy Surburbia to Loftdom, I found myself in the market for industrial shelving. This is bare-basics shelving, metal and bolts, the kind that looks good in a spacious factory that has been converted into residential accommodation," writes Kevin Davie, who finds some signs that the economy is running out of capacity.
The oil industry in South Africa is doing more than nicely thank-you from government-controlled fuel margins that appear extremely generous compared with those in markets Australia and the United States. All three — South Africa, Australia and the US — have a high reliance on private transport. Fuel prices this week topped R6 a litre in Gauteng for the first time.
Auditor General Shauket Fakie has called for documents that deal with the government’s financial arrangements with Sasol. The fuel-from-coal giant, on which taxpayer support was lavished in the past, has been at the centre of controversy as oil prices have jumped dramatically in recent months and continued to trade at these much higher levels.
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/ 19 September 2005
South Africa’s home-grown fuel giant Sasol published its annual results recently against the background of continuing high fuel prices and intensifying debate over how well the current regulatory regime serves the country. Pump prices internationally are in the spotlight.
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/ 9 September 2005
Minister of Minerals and Energy Lindiwe Hendricks threw up her hands at escalating fuel prices, saying there was nothing the government could do. But administered prices, those set by regulation, make up a large part of the fuel price and the evidence is that the government has been doing a poor job in keeping price increases in line with inflation.
We’re cycling in Mozambique just the other side of the border of the Kruger National Park when we come across a group of men working on a fence. We stop a short time later and discuss the work party. Most seem to think the fence was being put up
The government, having identified import parity pricing as a prime economic evil, is turning a blind eye to this practice in the fuel industry, which is making spectacular profits on rampant oil prices.President Thabo Mbeki has been leading the charge against import parity pricing.
Safika Holdings, one of the highest black economic empowerment fliers, is jointly controlled by Standard Bank, Competition Tribunal documents show. The tribunal earlier this year approved a merger between Standard Bank and Safika, where the former bought a 20% stake in the latter for an undisclosed sum.
Spare a thought for Telkom CEO Sizwe Nxasana. He has just had his salary package cut by 37%, from R11,14-million to R6,9-million. Telkom has cut executive salaries and bonuses in the past two years from R59-million to R33-million. The Telkom board, no doubt, has taken note of the new mood sweeping the country as workers look not so much at CPIX.
Airports Company of South Africa (Acsa) chief executive officer Monhla Hlahla says it is okay for her to have a shareholding in two companies that are major service providers to Acsa because her shareholding is too small for it to constitute a conflict of interest. Acsa is 75% state-owned, 20% being owned by Aeroporti di Roma (AdR), a Rome-headquartered company that has the option to buy a further 10%.
Union investment giant the South African Clothing and Textile Workers Union’s (Sactwu) R2-billion interests are so vast and sprawling that it is no surprise to find some unlikely properties in its portfolio. One is South Africa’s most successful rugby team, the Blou Bulle. The Bulls’ skills with the rugby ball have not been matched with financial prowess and so over the years outside interests, so to speak, came to own it.
Ask anybody who has made the most money out of empowerment and they will probably say Tokyo Sexwale, whose shares in Mvelaphanda this week were worth R400-million. Not far behind is Hosken Consolidated Investments’ John Copelyn, whose shareholding until recently was worth R358-million. Unlike Sexwale, though, Copelyn, is white.
The clothing sector is sometimes called the rag trade. Rags and riches may be more apt. If you work, for instance, as a machinist in the rag trade in a KwaZulu-Natal area such as Newcastle, you can expect to earn a union-sanctioned wage of just R228 a week. The same industry, though, paid R10-million to Edcon chief executive Steve Ross last year, nearly 1 000 times that of the machinist’s annual wages.
In a move that signals a new approach to the labour market, the Department of Labour is declining to issue a certificate of representivity to the National Bargaining Council for the Clothing Manufacturing Industry. The agreement governing the clothing industry expired on June 30.
Aeroporti di Roman, the Italian-headquartered company that operates airports across the globe, is set to divest its stake in the Airports Company South Africa (Acsa), having seen the value of its stake increase from R1,2-billion to R3-billion since 1998. AdR paid R819-million for a 20% stake in 1998, valuing Acsa, which operates 10 airports in South Africa, at just more than R4-billion.
Hundreds of employers marched in Durban’s Gale Street this week, alongside their workers this time. More than 700 of these small employers countrywide face jail terms and having their assets seized because the organised industry, the National Bargaining Council (NBC), representing 1 100 employers, is bringing compliance action, which threatens their survival, against them.
No one could have predicted that a white South African would amass a R100Â Â -million-plus fortune from the empowerment process, but Mark Willcox, the CE of Mvelaphanda Holdings,has done exactly that. Willcox, holds 4,4% of the JSE Securities Exchange-listed conglomerate.
The focus always falls on the disparities between the salary packages of chief executives and the lowest-paid workers, but the era of black economic empowerment deals reveals much larger gaps between the top names and the broad base of shareholders.