The mistakes related to important work and closely watched strategic decisions coming from the department of mineral resources and energy are simply not good enough.
Minister Gwede Mantashe, who was appointed in February 2018, inadvertently punted a hoax mineral to hundreds of delegates at an investor conference in Australia, and then the incorrect version of the long-anticipated Integrated Resource Plan was made public.
The charitable way to look at the department is that it is in a state of flux, with Mantashe overseeing a merger of the minerals department with energy, and that we need to give officials a bit of time settle and find their feet.
The other view — and the one more likely to be the perception — is that the department is in a bit of a mess and is struggling to attract skilled and competent officials who can ensure everything put into the public domain is entirely accurate.
More broadly, the government under president Cyril Ramaphosa, with its stated intention of unravelling the shambolic, inept and corrupt governance under his predecessor Jacob Zuma, simply cannot have a key department stumble over what should be fairly basic matters.
A decent scriptwriter who is fact-checked would have spared Mantashe the need to exhibit good-natured, self-deprecatory humour on public platforms when explaining away the Hazenile mineral embarrassment.
Surely someone from the department would have checked the right version of the resources plan was going onto the Government Gazette site accessed by investors, commentators and the media.
Government departments have to send a message of competent administration in the light of Ramaphosa’s quest to attract $100bn of foreign investment, reassure existing investors their money is safe, give lenders assurance that the state knows what it’s doing and is not frittering away scarce and expensive money.
Ramaphosa must read his ministers the riot act to get their departments into gear. Anything else sends entirely the wrong message.
African Phoenix touches new high
African Phoenix Investments (API) touched 84c on Monday morning, the highest level the share has reached since it emerged from the ashes of African Bank Investments’ (Abil) business rescue process in May 2016. It then settled at 80c. Investors are evidently excited about the likely outcome of the shareholders’ meeting that has been called for early November.
At this stage it looks as though API’s plans for the launch of a private equity fund are set to go up in smoke despite the backing of the Public Investment Corporation (PIC), which holds over 10% of the company. The PIC is keen to see the development of a black-managed private equity player. However the two major shareholders, Zarclear and Steyn Capital, who together hold almost 50% of API, appear to be in agreement about scuppering the proposal.
In early September Zarclear, which bought 22% of API a month earlier, called for a shareholders’ meeting to vote on terminating the private equity plan. It also said it wanted to appoint three new non-executive directors. Zarclear paid R246m, equivalent to 80c a share, for the stake, which it purchased from Value Capital Partners, Coronation and Allan Gray.
Terminating the scheme only requires an ordinary resolution so it’s difficult, at this stage, to see what could block Zarclear’s plan. If Zarclear is successful it is expected that most of the R1.2bn cash that was to be used for private equity deals will be distributed to shareholders. Now that Stangen has been sold API’s only other significant asset is an assessed tax loss of about R14bn, which would be very attractive to a profitable financial business.
Also in the months ahead API will have to settle its court action with the dissenting preference shareholders who refused to accept the R37.50 a share offered to the holders of the 13.5-million preference shares.
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