By Linda van Tilburg
- Eskom will be the “death knell” for South Africa’s mining industry unless the government enables mines to produce their own electricity. That is according to Exxaro Resources CEO Mxolisi Mgojo, who was addressing a conference organised by Business Unity South Africa. Mgojo said “without fixing Eskom we don’t have a mining industry. It is as dire as that.” He said the mines were in discussion with the ministries around that, how they could go about investing their own money in alleviating the electricity demand within the grid. It just needed the will from somebody else to make that happen, Mgojo said.
- Speaking at the same conference, President Cyril Ramaphosa said land distribution must be finalised in 2020 and has asked business leaders to present solutions to redistribute land to the majority blacks as the government works to finalise changes to legislation and the constitution to allow for the expropriation of land without compensation. Ramaphosa said he would like “the business community taking this issue up rather more seriously.” Business Unity’s president Sipho Pityana told the government that real action is needed to turn around South Africa’s struggling economy. Pityana said South Africa has enough technical committees, task teams and Presidential commissions whose recommendations gather dust in the Presidency. He said Finance Minister Tito Mboweni hit the nail on the head in his latest warning that South Africa was running out of time.
- An appeal by insurer Old Mutual against a judgment delivered in July last year to temporarily reinstate fired CEO Peter Moyo was upheld by the High Court in Johannesburg yesterday with costs. Old Mutual had prevented the CEO from gaining access to his office after his initial court victory, and in August issued another notice terminating his employment, paying out six months of his salary. Moyo retaliated saying he may sue the company for R250m in damages. Old Mutual’s shares jumped by as much as 5.2% after the judgement but ended the day on the Johannesburg Stock Exchange 3.25% higher. Moyo indicated that he may appeal the decision while Old Mutual said it had been vindicated and the board was now mandated to seek a new CEO.
- Woolworths investors cheered the news that CEO Ian Moir will step down in a month’s time, sending the share price up 8.3%. Under Moir, Woolworths has been forced to write off billions of rands after the retailer’s $2bn acquisition of Australia’s David Jones. Moir, who will stay on as acting CEO of David Jones, will be replaced by South African Roy Bagattini, who is currently the President: Americas for Levi Strauss & Company. Woolworths said in a statement that Bagatiini was responsible for leading Levi’s largest commercial operations, including a significant network of retail stores, spanning the United States, Canada, Mexico, Brazil and Latin America. He also played an instrumental role in the development and acceleration of the e-commerce and omni-channel capabilities of Levi Strauss.
- Vodacom is in talks with Cell C about taking on the smaller rival’s contract-paying mobile-phone customers, a move that would strengthen its position as South Africa’s telecom market leader. According to Bloomberg sources, the unit of the UK’s Vodafone Group would gain just over 1 million high-paying subscribers from the deal. Meanwhile Cell C and its biggest shareholder, Blue Label Telecoms, are looking at ways to cut costs and strengthen the balance sheet as they battle to service R9bn of debt. Transferring the customers to Vodacom would attract a fee and free Cell C from the cost of servicing clients, including handset subsidies and credit checks.
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