BEE giants spring generous Christmas surprise

2009-12-12 13:16

 IT’S been a busy week for black-owned

conglomerates African Rainbow Minerals and Mvela Holdings.


African Rainbow Minerals (ARM) executive chairperson Patrice

Motsepe might as well have traded his expensive suit for a Santa Claus costume

when he ­donated R8.9 million to nine traditional leaders.


And Mvela Holdings announced its Christmas shopping list with the

news that the company had acquired a 65% stake in factoring company Merchant

Factors for R120 million.


In addition to the traditional leaders, the beneficiaries of this

heightened activity during a period that is usually dull will be trade unions,

churches, small businesses and investors.


The traditional

leaders who will benefit from ARM’s donation are Kgosi Setlamorago Thobejane,

Nkosi Ndamase Ndamase, Nkosi Maxhob’ayakhawuleza Sandile, Nkosi Goodwill

Zwelithini, Nkosi Phathekile Holomisa, Kgosi Nyalala Pilane, Nkosi Makhosonke

Mabena, Khosi Tony Mphephu and Hosi Mlungisi Ntsanwisi.

The leaders are expected to use the money to uplift their

communities.

The money was disbursed through the ARM BEE Trust.


Motsepe said it was not right for traditional leaders to go around

begging for donations.


He also said the shareholders of ARM would each receive at least

R18 000 in dividends.


A group of 30 female hawkers who invested in Ubuntu-Botho, which

sponsors Motsepe’s football team, Sundowns, were promised at least R350 000

each.


Ubuntu-Botho was set up in 2003 to purchase a 10% stake in

Sanlam.


Trade unions, the SA Democratic Teachers Union and the National

Education, Health and Allied Workers Union also stand to be major beneficiaries,

alongside the ­Zion Christian Church Trust.


The distribution of the funds raised eyebrows, as ARM operates in

an industry that has been pummelled by the global economic ­crisis.


Motsepe said earlier this week that he would support the call for

the nationalisation of mines if it was in the country’s best interest.


Buhle Mthethwa, who is fighting a power coup at the embattled

National Federated Chamber of Commerce and Industry (Nafcoc), attended the event

and was introduced as the president of Nafcoc at Motsepe’s special request.


Motsepe and Mthethwa’s working relationship goes back a few years,

when they both served as executive members of Nafcoc.


Private equity group RMB Corovest, which had initially invested in

Merchant Factors seven years ago, sold the stake as it wanted to exit the

investment.


Merchant Factors chief executive Johnny Philippou said the

remaining 35% of Merchant Finance, founded by him in 1988, is held by

management.


The company provides factoring and debtor administration services

to small and medium enterprises (SMEs) with annual turnovers between R1.2

million to R120 million.


Factoring allows businesses to access their cashflows more quickly

by avoiding the delay in the payment cycle.

They do this by selling their

invoices to factoring companies at a discount, in exchange for immediate

cash.


Philippou said Merchant Factors’ factoring and working capital book

was worth more than R500?million.

He was upbeat that the association with

MvelaHold could help grow the book to R3?billion over the next few years.


“Together we will develop a joint strategy to offer empowerment and

working capital funding to the SME market. This funding is central to the

success of this segment of the business community,” he said.


“We regard this as the key to unlocking real economic growth in SA.

Our partnership comes at a time when government is placing greater emphasis on

the development of SMEs as a priority.”


MvelaHold chief executive Mark Willcox said its investment in

Merchant Factors was an opportunity to support the SME market.


“We will work closely with them to grow the company’s presence in

this market,” said Willcox.


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