Gate-crashing?the boys’ club

2014-03-23 14:00

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Twenty years on, Wiphold is a company of substance and a driving force when it comes to empowering women

Gloria Serobe and her company have been gate-crashing the boys’ club for 20?years and the cement industry is no exception.

By 2016, they will have completed construction of a cement manufacturing plant in Limpopo. Serobe is one of the founders of Women’s Investment Portfolio Holdings (Wiphold) and is the CEO of its financial services subsidiary Wipcapital.

Wiphold raised eyebrows when it ventured into building a cement plant with Chinese partner Jidong Cement three years ago as this was not in line with Wiphold’s traditional investments, and required significant operational involvement – something it had done largely in financial services rather than in the world of construction.

Several media reports said the building was meant to be completed in 2012 but Serobe said this was not true. According to her, there had been delays due to a lengthy project-financing process but the plant was on track to be commissioned in 2016.

She said the R1.6?billion deal was still on and that Jidong last week deposited about R500?million as part of its equity investment in the joint venture with Wiphold, which has invested R200?million.

Serobe said: “The building of the cement plant in Limpopo is a deliberate exercise to get into a sector that thinks women do not exist. After 2016, there will be a Mamba Cement in your warehouse because Wiphold says so.”

Mamba Cement is the special-purpose vehicle created for the joint venture of the cement plant.

“We’re asked a lot about why we are not worried that it’s a saturated industry, but the decision came on the back of six years of work and study, and we were not light-hearted or sentimental about it.”

Serobe said many cement plants in South Africa were, on average, about 40 years old. They would have to be decommissioned at some stage when Wiphold would be well positioned.

Wiphold has come a long way since its launch 20?years ago by Serobe, Wendy Luhabe, Louisa Mojela (now CEO of Wiphold) and Nomhle Canca.

It had seed capital of R500?000 and its first investments were in Baobab (which became Theta Securities and later African Bank Holdings) and Bidvest.

The group now holds assets worth more than R2?billion and has distributed about R500?million over the past 20?years to its 18?000 shareholders, most of whom are women or organisations that represent women.

Its investments include stakes in Old Mutual, Nedbank, Mutual &Federal, Distell, Sun International and Sasol Mining.

It also runs Wipcapital, an advisory services and corporate finance company.

After 20?years, Serobe still considers the company’s listing on the JSE as a highlight. It raised an initial R25?million from 18?000 female shareholders to do this. In the same year, it had a rights offer where an additional R75?million was raised.

But Wiphold didn’t stay listed. In 2003, it delisted to focus on increasing the economic ownership of black women, as the listing had diluted female shareholding by 22%.

Mojela said Wiphold had evolved in its two decades of existence. It initially eyed four sectors?– financial services, tourism, telecommunications and consumer goods and services.

It has been operationally involved in some of its investments like the financial services sector, but it is increasingly entering sectors where it can play an operational role.

Apart from the cement plant, the resources arm of the company, Wipcoal Investments, entered into a R1.9?billion deal with Sasol Mining to take advantage of its expertise in coal mining.

Serobe said Wiphold was looking for a coal asset it could operate and control.

BEE has attracted much controversy as some believe it is not an effective tool for broad-based transformation and that it often enriches a few.

According to Serobe, it was important for players to take note of the concerns but not to be defensive.

“It is a policy that is trying to undo a unique and difficult system so there are going to be issues in the execution and implementation of the policy.

“So I am not uncomfortable with the nature of the criticisms of BEE. BEE players like ourselves should take note of the concerns instead of being defensive and fix where we have to fix.

“It is a new policy and there is no reference for it in the world so it must have errors and it must have issues, and we must respond accordingly.”

She understood criticism that BEE owners are passive. “We want to get people into the mainstream economy and you can’t do that if you are at the golf course every day.

“There is a certain amount of attention to detail, work ethic and precision required to implement the policy because it is dealing with a huge generational problem of destruction, so we cannot be casual about it.”

Serobe said the company’s worst investment decision was to invest in Pepsi in 1993?–?but “luckily it was only an option so we didn’t lose a lot of money”.

She added: “But it was a failure because it was difficult for Pepsi to return on the back of Coke – it had been away for too long.”

She also said Africa was very much on the company’s radar and it was looking for ways to replicate the successful model in South Africa and adapt it to the African market.

But don’t expect another listing soon. Now is not the right time, according to Serobe.

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