Peter Vundla: In the wrong neighbourhood

2013-11-17 14:00

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In this edited extract from his book, Peter Vundla talks about his fraught relationship with Pamodzi

Early in 1997, Solly Sithole and Ndaba Ntsele visited me at the HerdBuoys offices in Marlboro, I did not know both well, but had seen them around town in their trademark crew-neck shirts, gold chains around their necks and Rolex watches on their wrists.

They both exuded success. Solly was a former mealiemeal sales rep and Ndaba was a former traffic cop.

They told me that my old friend, Felicia Mabuza-Suttle, who was now a popular TV talk show host, had sent them to me.

I did not buy their credentials of being in the property and construction business, but what I found impressive was their ability to have persuaded Nike to select them as their local partners.

Against my better judgement, I agreed to become chairman of Pamodzi Investment Holdings.

However, I had a lingering doubt and suspicion about the name Pamodzi, but Ndaba and Solly assured me that this was a Nyanja (sometimes Chinyanga) word meaning “we are one”.

The first time I had heard the name was with reference to the Pamodzi Hotel in Lusaka, reported to be a rendezvous for South African car thieves and drug dealers.

As they left my office, little did I know that I had entered into a world of intrigue, deceit, bad faith, abuse, poor governance and witchcraft.

As was the norm at the time, we would need a financial institution to become an anchor shareholder.

African Merchant Bank (AMB), with whom I had had a relationship while sitting on the board of New Africa Investments Limited (Nail), became that shareholder. AMB would take a 20% stake and advance finance to run Pamodzi.

Ndaba Ntsele became the CEO with a top-heavy executive team consisting of Solly, Sifiso Msibi, Kobus du Plooy and Jan Roesch, who were also shareholders.

Other shareholders were Felicia, Andrew Wheeler and an amorphous Pamodzi Trust. On May 30 1997, a shareholders’ agreement was signed.

Management had a very broad investment mandate given the myriad opportunities that were opening up.

Large insurers and conglomerates were unbundling and shares in most of these companies were available to BEE companies.

Pamodzi would invest in the catering, cleaning, security, tourism, information technology, healthcare, sports and entertainment, facilities management, and financial services industries.

The agreement stated that “the chairman of the board will be appointed on an annual basis. The first chairman will be Vundla, who shall remain in office for the first two years”.

Clearly, I would be the rainmaker in this investment company.

Big business wanted to do business with me, not with the unknowns who hung on to my coat-tails [bar Felicia].

It would be two years and more of the abusive use of my name. I had forgotten my father’s maxim: “Use me but don’t abuse me!”

I had gone into business as a shareholder and nonexecutive director with people I hardly knew, some of whom I had never heard of. I was acquainted with Msibi from his days at MTN.

He was a nice enough civil engineer who hailed from KwaZulu-Natal. He was thoughtful, principled and respectful, and often referred to me as “Mr Sherman”.

Then there was Du Plooy, who I think was formerly with the Industrial Development Corporation. He spoke a smattering of Zulu, which used to amuse Solly to no end.

Then there was Roesch, who was simultaneously company secretary and investment officer. He had been with Absa, I was told.

While not an executive, Wheeler was the most well-read and this gave him the advantage of being a strategic thinker.

He would inundate us with articles on this and that, including papers on governance.

Zenzo Lusengo would become AMB’s representative on the Pamodzi board.

The launch of Pamodzi took the country by storm. We became adept at public relations: we were bullish and gung ho with an abundance of bravura and nice catch phrases.

There was lots of bullshit, which regrettably some of my partners actually believed. Often I had to remind them of the old adage: “Never believe in your own PR.”

New investments soon came in thick and fast.

By day, the Pamodzi management really worked the investments we had.

They were truly value-adding empowerment partners. But I did not have an after-hours or weekend relationship with them.

When not talking business, I found them rather remote and disengaged. I actually had little in common with them.

Often, I would be called in to intervene in infighting, even on such silly matters as witchcraft.

Ndaba called me once to complain about threats of violence from one of his executives. It was just too much for me to bear. Damn, I had my own children!

Outwardly, Pamodzi presented a united front. By now the shareholding in Pamodzi had become somewhat broad-based.

Management had drawn up a list of influential blacks, including [then] ANC secretary- general Kgalema Motlanthe, to take up shares in the share trust.

I had little input into this list but was not concerned about any of the participants.

In around 2000, Nail unbundled its 53% stake in AMB, thus leaving an empowerment void.

Pamodzi wanted to compete to fill the void. After a presentation to the board, Pamodzi was the preferred partner – much to the chagrin of one black AMB board member who claimed to have some history about some of us at Pamodzi.

The plan was for me to become executive chairman of AMB subject to SA Reserve Bank approval. Two Pamodzi executives were to join me on the board. By now, Happy [Ntshingila] was back at HerdBuoys after a small diversion to head up marketing at Vodacom.

In 2001, I handed over the reins to him and moved to AMB as nonexecutive deputy chairman as the reserve bank was quite correctly not enamoured with executive chairmen working with chief executives in a bank.

The relationship between AMB management and my Pamodzi executives was fraught with mistrust and suspicion.

They would not accept one another at face value. I had to spend a large portion of my time being the bridge-builder. The issue that would bring a total breakdown in the relationship was Pamodzi’s desire to increase its shareholding in AMB.

On March 4 2003, I called Ndaba to a meeting where I handed him my letter of resignation from the chairmanship of Pamodzi.

I was so happy to be done with these fellows. I remained a shareholder but I was wrong in thinking I was done with them.

I put out the usual bullshit press release about my leaving to “pursue my own interests”, without saying why I was resigning. I signed a service contract with AMB and started buying my own personal shareholding in the bank.

Peter Vundla Doing Time Jacan, 241 pages; R182.40,
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