Listen here.He turned around mines others had written off and built Sibanye-Stillwater into a global giant. Now Neal Froneman wants to bring Formula One back to South Africa, on 600 hectares of Swartland farmland rather than at Kyalami. In conversation with Alec Hogg, the Blue Mountain Racing chairman explained why he treats the R6.7bn project like a mine still in exploration, what the fallback is if Formula One says no, and why he believes a modern Grand Prix is a week-long spectacle that old circuits simply cannot host. He also tackled the question hanging over every South African bid: after the Lady R affair, what stops government's foreign policy from sinking this one too? And he made his case for why Cape Town, not the team behind it, is the winning card..Edited transcript of the interview.Alec Hogg: Neal Froneman spent more than a decade running Sibanye-Stillwater, much of that time taking on deep-level gold, platinum and palladium mines that nobody else seemed able to bring to account. In fact, others had given up on them. He didn't. He turned them around, and today it's one of the great mining companies of the world. Now he wants to take on something much harder: a place on the Formula One calendar.His consortium, Blue Mountain Racing, has bought 600 hectares of land in the Swartland in the Western Cape: Froneman says the land is held under option, not owned and is pitching a R6.7 billion motorsport and property precinct. Rothschild, the storied international finance house, is advising on the money, and the target is a Grand Prix in South Africa in 2031.But the South African government has already backed Kyalami, which is far away in Gauteng. And elsewhere on the continent, Rwanda is spending big in its attempt to bring Formula One there. The ANC's strange international bedfellows have already kiboshed our supposed Formula One race that should have happened a couple of years ago. They were on the point of signing when Liberty Media said, "Down pens, we're not doing this". That was to do with the Lady R scandal. You might remember a Russian ship that docked in South Africa to pick up, apparently, munitions that were going to Russia for its fight against Ukraine. So, lots of challenges.Here's Neal Froneman with us. I guess the obvious question, Neal: why Formula One for you? Why now? And why the Swartland rather than Kyalami, which already has a track?Neal Froneman: Hi Alec, and nice to talk again. Well, first of all, let me tell you this is not too different to building a mine. And in this case, it's not even a brownfields project; it's a greenfields project. To be clear, we are still in the exploration phase. That doesn't mean we haven't made significant progress.What you probably don't know about me is that in my younger days I was quite an accomplished rally driver. I then raced saloon cars on the old Kyalami track. I did well, but recognised that I was never going to be a Formula One or world-class racing driver, and focused on my career. In my mid-forties I went back and did a bit of single-seater racing. I raced Formula GTi for a number of years and did as well as I could in the masters. So I've always had a little bit of racing in me.But this is far more about a commercial opportunity. I don't even watch Formula One on television every Sunday. I'm interested in the results, I'm interested in the technology, but this is very much a commercial initiative, and something that is, in my view, in the national interest.You describe the history of failed proposals to Formula One. It's my understanding, and I don't have exact information, that those were not good proposals. Lady R was certainly an issue, like many of the things in South Africa that don't help commercial opportunities. But certainly we have blotted our copybook with Formula One.We are a bunch of professionals, and maybe I can talk a little about the team. I'm the executive chairman. I suppose my skills are that I know how to run a business, I know when it's going to make money and when it's not, and I'm reasonably good at putting strategy into place.The team consists of Bobby Hartslief, who was actually the original founder. Bobby ran the last few Grands Prix in South Africa in the 90s. That's probably not well known. I got to know Bobby through his father, who was the general manager at Venterspost Gold Mine. I've known Bobby since we were youngsters, and we used to meet for breakfast once every quarter, and he used to tell me about his plans.Bobby, I think it's important to know, was instrumental in building Phakisa in Welkom and bringing MotoGP to South Africa. On behalf of MotoGP, Bobby also made it a very popular sport in the US. So the links to motor racing are real. We have people in our team, and I don't include myself, as I say I only dabbled in racing, who know how to start a Grand Prix at two o'clock or three o'clock, whenever it starts on a Sunday. They know how to organise that, and they have relationships with people like Bernie Ecclestone and, of course, MotoGP.We also have Robert Appelbaum, a very accomplished lawyer with lots of contacts and legal expertise, a senior partner at Webber Wentzel. And then Venkat, with the unpronounceable surname, who was the previous CEO of AngloGold Ashanti. Venkat and I worked in the mining industry together. Other than Bobby, who approached me, everyone else has volunteered for this job.The only other thing I'd comment on in your introduction is my interaction with government. They support a Grand Prix in South Africa. Kyalami looks like the obvious choice, but there are certain challenges with an old-style motor racing circuit, which we can talk about. Minister Gayton McKenzie has said to me that he supports us, I can quote him publicly, and that Formula One, or Liberty Media, will decide where this Grand Prix happens in Africa.Of course, I just think Cape Town has an incredible competitive edge. It's one of the most important tourist destinations in the world, rated seven years in a row one of the best cities in the world. Couple that with the wine, the cuisine, Table Mountain, Robben Island and the Atlantic Ocean, and the Swartland has access to all of that. You have an unbelievable destination, which a circuit designer can't manufacture. So we think we have the best possible chance of a sustainable, long-term Grand Prix, and we can talk about the commercial aspects separately.Alec Hogg: Lovely background, and thank you for that, Neal. I had no idea you were a racing driver. Were you in the Sarel van der Merwe kind of era?Neal Froneman: Yes, yes. I was navigating before I even had a driver's licence. In those days it was very strict in terms of getting a driver's licence. In my first year of university I had to go to university by bus because I was too young to have a licence. But the first club I joined was the Wits Rally Club, and I competed with a friend as a navigator. I love motor racing, I love mechanical things: fast cars, fast boats, fast planes, all those sorts of things.Alec Hogg: Fast helicopters, as I well know. One of the things you taught me, from the sky, was the Witwatersrand and how it all fits together. I'm forever in your debt for that.But something about Formula One that many of the younger generation don't remember is that we had our own champion, Jody Scheckter, a proudly South African Formula One world champion. His nephew Warren Scheckter tried to bring Formula One to South Africa and wasn't able to. So I've got to wonder: if a champion's family tried and couldn't, what is going to make this bid different? Have you had any inkling from the Formula One overlords that they might be keen to come to the Swartland?Neal Froneman: I'm a bit restricted in what I can say. Let me say we have had our first interaction with Formula One. We are a long way from a negotiation process. But when I review previous bids, I think it used to be about a motor race, and you're right: in those days, if you were a Formula One champion, that would count for a lot. Today it's a spectacle. It's a completely different business. It's an entertainment destination, a week-long festivity, and it's a lot more about the destination.Many of the historical tracks, Zandvoort, Imola, are almost history now. You are seeing a completely different evolution of Formula One. In fact, there are now more women who support Formula One than men, and you'll notice it from the branding and the sponsors.It's a spectacle, Alec. The motor racing is almost a catalyst for something else. Liberty Media have taken Formula One from a motor race, which I think was very well run by people like Bernie Ecclestone, to a spectacle, and Liberty Media is about entertainment. Liberty Media has artists like Taylor Swift, Beyoncé and so on. So there's a completely different thought process. Of course, the motor racing is to very high standards, high technology. The motor racing is important, don't get me wrong.I also think there's been a lot more coverage and outspokenness by certain Formula One drivers, Lewis Hamilton being one of them, about the need for a Formula One race in Africa. And when you start thinking about infrastructure, medical facilities, internet connectivity, there aren't many African countries anywhere near where South Africa is, which positions us with such a competitive edge. As long as you understand what drives the commerciality of Formula One, I think we can be successful.Certainly, as we progress, we will try to involve people like Jody Scheckter. There are a lot of up-and-coming South African racing drivers trying to make it in this very competitive world who I think could become ambassadors for what we're doing. But if you don't have a strong commercial underpin, and you don't have compliance... there are something like 8,000 formal requirements for a Formula One-approved race. If you don't comply with those, very little has to do with previous Formula One champions. They're important ambassadors, but there are strict, strict requirements to be considered by Formula One and Liberty Media.Alec Hogg: So it probably is a good idea to have a greenfield site, then. In other words, start from scratch rather than the old Kyalami, where it's many years since the last Formula One race. But these 600 hectares in the Swartland: have you bought them? Do you own that land?Neal Froneman: We have it under option, Alec. You would understand this: it's an iterative process, almost a circular argument. You're not going to get your equity funders to commit unless you have an agreement with Formula One. Formula One won't agree unless you have the funding in place. And of course we can't buy the land until we have the funding in place. But there are ways of managing those risks for your investors.So we went the option route, which is still expensive. It's still costing a significant amount of money to secure that land. This is a four-year process. There are two years of approvals, things like environmental approvals, the detailed engineering, essentially preparing a feasibility study.So there's a phase of seed funding, which is going to cost about R120 million, and which will come from high-net-worth individuals. It's almost venture capital. Only once you've been able to demonstrate your ability to have an equity funder, and your ability to have bank financing, because the model is based on 40% equity and 60% debt, only once you can demonstrate all that to Formula One, will you eventually end up with a contract, which would then trigger the actual funding from your equity and debt funders.If I use the equivalent mining terms, we're in the prefeasibility phase. Once we raise the seed funding, we'll complete the detailed feasibility. That's going to cost us about R120 million, and then the R6.7 billion of capital should be in place and ready for approval, as long as we get all the other approvals in place.Alec Hogg: Let me talk it back to you, so that we make sure everybody watching gets it. You have an option on the 600 hectares. The trigger will only be pulled once you've done the study, which will cost R120 million, and that is approved by Formula One. So you could spend the R120 million and Formula One says, "Nah, we're going to Kyalami or Rwanda or somewhere else," and the whole project ends. That's venture capital; that's the risk of business. But if they say yes, then you'll have R2 billion spent on a racetrack and another nearly R5 billion on a property development. But it's all contingent on Formula One saying, "We like Blue Mountain."Neal Froneman: Yes, perhaps with one area of risk mitigation for our seed funders: we will always have the ability to do the high-end real estate development. I just think it will be better and unique if you can say it incorporates a Formula One venue, approved by Formula One. But even if you are unsuccessful with Formula One, you will still have very valuable land underpinning this, and you could continue with the real estate development.Alec Hogg: Got it, so there's a fallback option. What was interesting to me was the way you decided to launch it, and the support you had from the Western Cape. How did that process work?Neal Froneman: It hasn't been a secret that we've been working on this project, but we really wanted to get some substance behind us so that when we did come to the market, it wasn't just hype and smoke and mirrors.It took six to nine months, Alec, to find the right piece of land. Land north of Cape Town is very tightly held, and of course it's all complicated by the Koeberg nuclear exclusion zone. There's some beautiful land, but you just can't develop it. We also learned very quickly that promoting a Formula One event was creating difficulty in acquiring land at a commercial rate. But eventually we got that right, and it happened to be right next to Kalbaskraal in the Swartland.What we also found is that the Swartland municipality is known as the best-run municipality in South Africa. I think Midvaal is second to the Swartland in terms of well-run municipalities. So the combination was very good.Right early on, I went to see the Cape Town mayor, Geordin Hill-Lewis, and I met the Premier of the Western Cape, Alan Winde. It was wonderful to receive unequivocal and unconditional support in the national interest. We don't often find that in government, I'm sad to say. You can understand why the Western Cape is as prosperous as it is, because these individuals, including the municipal manager at the Swartland, act in the national interest. It's been so easy for us to work with them, and they've been very supportive. A lot of that happened behind the scenes; we were not public about it.Then the Western Cape government wanted to hold an investment conference, and they asked us to participate. We thought we had enough under our belt for a more public release of the project and its details, and that's how it happened. We would probably have preferred to run a bit longer and get a little more under our belt, but in support of what the Western Cape government was trying to achieve, the timing was reasonable.So we spent a bit of money and a little effort on a proper public launch, and it's been overwhelming. I've never had so many WhatsApps, LinkedIn requests, people offering help. It really is wonderful, and you can see why this is in the national interest. I've had ex-Formula One racing drivers reach out offering their assistance, so it's become quite international, and it's exceeded our expectations. But Alec, that's how it happened.Alec Hogg: What about national government? Have they given you any support, apart from Gayton McKenzie, who does run hot and cold? I guess we all know that. Sometimes he gets terribly enthusiastic, as he was at some of the business conferences, and then afterwards he has other priorities, it appears. Have you had much solid support?Neal Froneman: Yes, listen, we have. Gayton, as I said earlier, has said he supports us, and we can publicly say it. We chose not to say it until now. But we also made a decision that we don't want government intimately involved in a project like this. We want them to support us; we need their support.You would also know that what Gayton has managed to do is get the government of national unity to commit to a guarantee, which Formula One requires, through sponsorship. So it's a bit of a back-to-back guarantee.I think it's important to recognise that we should not expect government to put any money into this, especially with the poverty and inequality we have in South Africa. This needs to be completely privately funded and built, and we need to be very clear on the boundaries between what government does and what the private sector does. That's why I reinforce that this is a commercial venture. Yes, it is something like a soccer World Cup; it's not too different to that. But this is a private initiative. What we need is government support in creating the right environment. We don't need their commercial support.Alec Hogg: So government would give a guarantee to Formula One, because Formula One requires that guarantee from a government. You couldn't give it to them yourselves.Neal Froneman: Correct, correct. But the funding of that guarantee has been committed to by certain large corporates for whom marketing is an important part of their business. They've already given those guarantees, or support, to Gayton, and all credit to him for having arranged that. That structure is essentially in place for whoever is the successful bidder to Formula One.Alec Hogg: Someone I know very well was in the room in Monaco when Liberty Media was about to sign Formula One to South Africa, and the Lady R issue and South Africa's support, or apparent support, of Russia came up. Liberty Media, being an American company, literally said, "No, we're not going to do the deal." They were right there. That's according to a person I know who was in the room check.What if the South African government misbehaves itself again in foreign relations? You can't determine South Africa's foreign policy. What risk mitigation can you build into the project that would ensure Formula One doesn't pull out the way it did then?Neal Froneman: So that is a risk, Alec, and I have been very critical of our foreign policy. What I do know, though, is that the issues are with the South African government, not with the private sector.My understanding also was that that bid was not well constructed. There are issues between the ownership of Kyalami and the investments needed to put in the infrastructure, and the more recent bids were not well received by Formula One because they weren't properly developed.But through my work in Washington and with the US, we have made it very clear, and I think some of that is starting to become apparent now, that the private sector and the majority of South Africans are not the problem. Therefore, don't punish business in South Africa. Rather, target those individuals who continue to drive policies that are not supported by the majority of South Africans: expropriation without compensation, the foreign policy, the support of Iran and so on. And you've started seeing these targeted sanctions, if I can call them that, starting to come through now.So I believe that if we maintain our private-sector role clarity, it should not be a problem for Liberty Media. And I think North America is moving to punishing, as they should, those people who continue to promote things that are not in line with what most South Africans want.Alec Hogg: It's certainly not good for the economy, as we know; the track record is there. What's the biggest misconception among people in South Africa about bringing Formula One back? What I mean is that many people think we screwed it up and should never have let it go, but that because we used to have it, it's easy to bring it back. What do you think the public's getting wrong?Neal Froneman: Probably exactly what you said: that we've done it before, so we can do it again. We must remember that when we did it, it was in the early nineties, and Formula One was a race. In fact, the other job I did as a university student was as a Kyalami marshal, and I have some recollections of marshalling at a Formula One event.But it's not what it used to be. It was run like a race, and today it's a spectacle: five or six days, a week, of entertainment. The fan base is completely different, and the requirements are a lot more onerous, Alec. It's not as simple as just bringing it back. I would be happy if it came back to South Africa, whether it went to Kyalami or to us.But I have to tell you, the Formula One requirements are that a racetrack has to seat 125,000 people. You've got to seat 125,000 people in grandstands, and there's not one grandstand. You've got to be able to get people in and out of the venue in three hours. You can't do that in a landlocked, old-style facility. Hence our project is completely new, a clean sheet.We've got rail access. We've got the N7 with two off-ramps. We've got a community that is supportive and will provide the labour. The number of jobs created through this, direct and indirect, is enormous: we estimate 15,000, plus an additional 8,000 during a race week. The logistics are very different to what they were, and old race tracks just can't accommodate this.The media building is 10,000 square metres, and they tell you exactly how many chairs, how many plugs, how many screens. Clearly you can't design this sort of infrastructure unless it's dual-purpose. So the media centre in our case will also be a new convention centre, because the Cape Town International Convention Centre is essentially fully booked. It's such a different business model compared to the old-style tracks.Our track will incorporate an amphitheatre, because entertainment is part of the thesis, if I can call it that, especially if you've got links, or formal links, to Liberty Media, and you start using the venue for things like that. So it's very different to how it used to be, Alec. Formula One racing drivers are also quite particular, the teams are particular, and the circuits are completely different shapes and styles to accommodate the modern Formula One cars. And ours is not just going to be a Formula One track; it's also going to be a MotoGP track. In fact, to make the model work you've got to look at many other racing formulas.Alec Hogg: Which could give South African motor racing a real shot in the arm. And what you said a moment ago about the links to Liberty Media has got all the Swifties on board, because who knows, you might get Taylor Swift to finally come to South Africa and have one of her concerts, which I'm sure would be very well booked out.Neal, the process from here: what happens now? You've had your announcement, you've told people your intention, and it's been well covered in the media. But what happens from here, and what are you personally going to be doing to land this enormous challenge you've set yourself?Neal Froneman: The first thing we've got to do is the detailed technical work: the layouts, the environmental approvals. We've got to get the equity funding in place, obviously conditional on Formula One's approval. We've got to get the bank debt approved, also very conditional on the equity being raised. So there's a whole lot of technical work to be done, which then underpins your submission to Formula One, and a whole lot of financial workstreams that are also required to underpin any submission. They are not going to engage and start negotiating unless they know the project is funded.There's obviously the issue of the guarantee we spoke of earlier, but that's for the annual race fee. We don't know exactly what it will be, but somewhere between $30 million and $40 million a year to hold the event.So all the workstreams you would associate with any infrastructure project have to be detailed. We've got about eighteen months to two years to complete that work, and hopefully by that time we have an agreement with Formula One, which would then allow, with all the conditions met and the funding in place, us to actually build the track. The first race is only planned for 2031. So there's at least four years of, let me call it, pre-construction work, and then two years of construction.Alec Hogg: So, as you say, a little bit like building a mine. There's a heck of a lot that happens before you pull the first ore out of the reef, and it appears we have to be patient on this. It's going to be a five-year plan. But just to close off: what do you think makes this one different? What is the key difference to the other proposals presented to Formula One in Africa, not just Kyalami, but also Rwanda?Neal Froneman: I haven't heard a lot of people saying they want to go to Rwanda or Kigali. I have met many people who have been to Cape Town and want to come back to Cape Town. We all know the wonderful wines and culinary experiences we have in Cape Town. Table Mountain is iconic; Robben Island is iconic.Then, in addition, look at the infrastructure South Africa has: the highways, the medical facilities, internet access. We underrate the role of technology in Formula One. We also start with a clean sheet. We're not trying to take an old-style track and make it Liberty Media-compliant; we can design it to be Liberty Media-compliant. The Swartland is a beautiful area, Cape Town is beautiful, and local government is a pleasure to work with.So it's hard for me to see why we don't have a competitive edge, not only in South Africa but in Africa. Cape Town is a sought-after destination. The last thing I would say is that you'll notice one of the sponsors of Formula One is MSC Cruises. Well, you can't take a cruise ship to Gauteng. But you can take a number of cruise ships, and some very high-end yachts, into Cape Town harbour. To me, that's our competitive edge. It's not our team. It's Cape Town. Cape Town is our competitive edge.Alec Hogg: You didn't answer the question I had about you personally. What are you going to be doing to land this challenge? In other words, is this a 365, 24/7 job for you?Neal Froneman: Well, listen, at the moment the founders, the four people I mentioned, are effectively the executive. All of us are retired, all of us are mature, and I think we look forward to taking up non-executive roles. But until we get there, there's a lot of work to be done, a lot of promotion. And I don't mean promotion like hype; I mean engaging with banks and investors. That's what we're going to do. We meet every week; we have a board meeting every week. This is not something you do part time. I love being busy. It's a nice type of busy. I think I'll stop working when I die.Alec Hogg: Well, Warren Buffett says his retirement age at Berkshire Hathaway is 103, and I know you're a long, long way from 103, Neal Froneman. Good to talk to you again. I look forward to following the progress of your next big challenge.I don't think anybody would be writing off Froneman. He took Sibanye, you might recall, which was spun off from old mines that Gold Fields didn't want any more. They didn't want much of South Africa; they kept just one mine here. He essentially founded that company and turned it into a global giant. If anybody can pull this one off, Formula One fans, I think you've got him in the seat. Neal Froneman is the chair of Blue Mountain Racing. I'm Alec Hogg from BizNews.com.