Guptas BEE fraud; Trump impeachment pushes gold, dumps rand; Sibanye job losses; Moyo pitches up again

By Linda van Tilburg

  • Three companies linked to the Gupta-family were awarded multi-million rand contracts with Eskom even though their B-BBEE certificates were fraudulent. That is according to the Democratic Alliance, that has seen a report on the investigation into whether the Guptas had misrepresented their empowerment status. The investigation related to Gupta-owned companies Tegeta Exploration and Resources, Optimum Coal Mine and Trillian Management Partner. The DA says it was also found that BEE Matrix had acted in a manner that is contrary to the B-BBEE Act. Eskom is also criticised in the report for failing to follow empowerment legislation. The recommendations include that BEE Matrix should have its accreditation as a verification agency removed, implicated Eskom officials should be reported to the Police, Eskom should lay a complaint against the Gupta-linked companies at the National Prosecuting Authority and Trillian should be investigated by SARS.
  • The decision of the Democrats in the US to impeach President Donald Trump has pushed gold to a near three-week high. It raised uncertainty in the United States prompting a sell-off in equities. The House Democrats in the US launched the formal impeachment inquiry into Trump over his interactions with Ukraine President Volodymyr Zelensky. It is alleged that he tried to pressure Zelensky to investigate the family of Democratic Presidential hopeful Joe Biden and interfere in the 2020 election.
  • On the JSE, gold miners benefitted from a higher gold price with stocks of Gold Fields rising by 4%, Sibanye Gold moving up 3.63% and Anglo Gold by 2.56%. Moving down were the shares of Fortress Reit and Investec, which both fell by 6% and Naspers shares were down almost 2%.  The JSE All Share Index traded softer falling 1.34% tracking global markets spooked by talks of the Trump impeachment. The Rand crashed through the R15 to the dollar barrier to a low of R15.06 and ended the day on R15.01 to the greenback.
  • Sibanye Gold plans to cut 5,270 jobs at its troubled Marikana platinum mines as deadlocked wage negotiations brought a strike one step nearer. After posting a gain of R1.1bn ($73m) on the deal, the company plans to shut three unprofitable shafts as Chief Executive Officer Neal Froneman seeks to resume paying dividends next year. The Association of Mineworkers and Construction Union said the company was prioritising profit over people by exploiting South Africa’s labour laws to cut jobs.
  • Reuters reports that South Africa saw larger foreign direct investment inflows in the second quarter than the first quarter as domestic firms received debt and equity funding from foreign parent companies. According to Reserve Bank data, FDI inflows amounted to R26.3bn ($1.76bn) in the second quarter from inflows of R11.7bn in the first three months of the year. But Bloomberg reports that the South Africa’s economy remains stuck in its longest downward cycle since 1945, adding to pressure on the government to implement reforms to lift business confidence and boost growth. The economy entered the 70th month of a weakening cycle in September.
  • Peter Moyo has been prevented for a third time from returning to work at Old Mutual yesterday in the latest instalment of his fight against the insurer. He was fired in June over an alleged conflict of interest. Moyo has indicated that he will be applying to the South Gauteng High Court to have Old Mutual’s non-executive directors declared delinquent and indicated he will be trying to return to work again, but this time he will be bringing a court sheriff.
(Visited 29 times, 1 visits today)