Tokyo Sexwale’s acquisition trail
Charlene Smith
Posted Tue, 04 Jul 2006

Every richest men, walks into the Mvelaphanda boardroom in Johannesburg and sits down for lunch with his staff. At the head of the table is a driver, opposite Sexwale is a cook, on one side is a public relations consultant and on the other, his operations manager.

Lunch is informal. It is laid out buffet style and people sit and commence eating as they arrive. The boss sits wherever there is an open seat. Today he tucks into a curried lamb shank, he asks after the new babies two staff members have had and praises the young cook.

The style of the boardroom is not the harsh leather and wood paneling favoured by so many, it has voluptuous curtains, comfy couches, fabric chairs and views of trees. It exudes ease and confidence.

Sexwale is not a man who has to impress or imitate anyone. He creates the parameters of his own world. When he was premier of Gauteng, South Africa’s smallest and richest province generating 11 percent of Africa’s gross domestic product (only Nigeria, Egypt and South Africa itself generate more GDP), he had no boardroom table, members of his cabinet sat on low, comfy chairs with small tables at their side in the manner of Singapore executives. He liked the sense of openness and accountability this created.

By the time he handed over the premiership to former union boss, Mbazhima Shilowa, he had built the province’s public finance budget to R60bn (about $8.6bn) in just five years.

Sexwale set the template for governance in Gauteng: open, consultative, efficient. He once walked into a burning prison alone where prisoners were rioting, and walked out at dawn with a peaceful settlement. He says that business is neither as complex nor as demanding as public office, and although many in South Africa wish he would become a presidential candidate, he is firm that he has no interest in returning to politics.

“It’s bizarre that people think I can add more value to my nation as a president than as an industrialist. Perhaps it is a relic of old societies in Africa where it was important to be a chief. We need to change the views of many in Africa that the way to power and money is through politics.

“Government doesn’t create value, it spends. Business is the creator of value. What we need to focus on now in Africa is the creation of industrialists. African industry must partner with global interests and drive African development. Africans know where the shoe pinches.�

The problem in Africa, he goes on, is that business is, by and large, run by governments.

“Governments can’t run businesses, their role is to create the requisite climate in which business can thrive,� he says, adding that, “African industrialisation must be accompanied by the growth of strong civil societies and powerful democratic governments.�

He applauds some of the steps taken by President Olesugun Obasanjo in Nigeria, as an example, to create a better climate for business. He also believes that the importance of the New Partnership for Africa’s Development cannot be underestimated.

“Some countries have done well — Botswana and Egypt, for example. But when you touch down at the airports of other countries as a businessman, you find government delegates waiting for you. That’s why there’s so much corruption and misuse of public funds. In many places, political power is the only game in town.�

At the Mvelaphanda Group Friday lunch, most staff call him “chief� in the style of South Africans who were in exile (although few at this table have any political connections). The atmosphere is relaxed and happy. It feels more like a family Sunday lunch than lunch at the office with the big boss seated halfway down the table. The financial director pours wine produced by one of the wine farms Mvelaphanda owns.

Sexwale gestures at his staff, “Look, this is a Mandela table, we have people of every race here — white, black, Indian, coloured, Chinese…�

He famously once looked at the staff ratio at the headoffice of Mvela Resources and told his CEO, a white man, that there were too many black staff. “Go and find a white man and employ him, I want diversity in my companies,� he said.

Sexwale says that South Africa’s policy of black economic empowerment is “just a model of creating an entry into the economy. BEE doesn’t make a businessperson, or create the effort, acumen, skill or expertise, the sheer guts of what to do.� He says it puts an onus on black businesspeople to perform better. “The pressure after signing a deal is enormous. Black people have to show they can perform, that they can add value.�

Although Sexwale is a gifted and charming raconteur, he is also a good listener, and not just to his peers. He will seek and listen with respect to the views of the most humble. He has sufficient humility to ask others for advice and to take it. As premier of Gauteng, and a close confidante of former president Nelson Mandela, he met and made firm friends with the Rockefeller family, Bill Gates, Bill Clinton and others. He was able to pick up the phone and ask for advice and would implement it if he considered it sound.

He gathered around him young, bright people. Mark Willcox, a Cape Town financial guru, was one of the first and together the two scanned the environment for opportunities.

Sexwale was quite clear that he was not prepared to be a black figurehead for white consortiums. He wanted real management control for himself and his slowly growing team.

“My best decision,� he says, “was to surround myself with capable people, stars who are not ‘yes men’ to me, people who saw themselves as partners. I think they will say I can be highly demanding, sometimes militaristic. I respect expertise and skills and people who challenge me, who interrogate every step. Some are corporate magicians. They are men and women, black and white, South African and foreign. This is a global group.

“What we have done in Mvela is the creation of value. We employ 65 000 people today. The share price of Goldfields, as an example, is now worth three times more than when we first became involved with it.�

Mvela Resources has shown excellent growth. It reported in February this year that headline earnings per share rose to 622c (ZAR) from a 217c loss, and that Goldfields shares (they own 15 percent of the company) had gone up 45 percent since June 2005.

Through Ophir Energy he has oil and gas interests in 15 countries around Africa. At the time of the interview he had just paid $75mn for the signature rights to explore for oil in Equatorial Guinea. Mvela has oil rights in Nigeria, Saõ Tomé Principe, Gabon, Somaliland and Tanzania, among others. And the Group is having discussions about similar interests in Libya, Chad and the Sawari Democratic Republic.

They have interests in mines in Congo Brazzaville, the Democratic Republic of Congo and Sudan.

“It’s a high risk business and requires very deep pockets, it’s not for the fainthearted and it requires advanced technologies in exploration and development,� Sexwale says.

In South Africa, Mvela is involved with PetroSA in exploring the gas field at Ibubesi.

In Angola and Namibia he has interests in diamonds and through TransHex is second only to De Beers in diamond mining interests.

Mvela with Jurang Construction Company, which was instrumental in the new redesign of Singapore and Shanghai, is constructing a $250mn new city in Bayelese in the Nigerian delta and another in Equatorial Guinea, Malabo Two. “Other foreign oil companies have come to Africa, dug holes, taken the oil and gone,� he says. “We intend giving back prosperity to communities where we operate. We have to be sensitive to the interests of the country we operate in and have consideration for smaller enterprises.

“Where our companies are working we can’t have children outside our mines with kwashiorkor, while our engineers have wine and cheese.�

Mvela’s major shareholding in South African construction company, Group Five, which operates in just under 20 African countries, enables it to build roads to diamond fields in remote areas and erect clinics and small stores to create new communities for surrounding villagers and those who work on projects. They even undertake inoculation programmes among local children.

He sits on the international board of JP Morgan in New York with former US secretaries of state Henry Kissinger and George Schultz. And Mvela has the biggest black shareholding in South Africa’s largest bank, Absa, which Barclays has the major shareholding in and which is active across Africa.

As if that was not enough, Mvelaphanda has major shareholdings in South African security groups Protea and Coin, Royal Sechaba in food and in top international hotel group, Radisson, as well as Unitrans transport group, and interests in fruit farming, including wine. These companies, he says, “are the cash cows� and complement the mining operations. “Take our mining in Angola, we need security, medicines, food, we need to build infrastructure, there is synchronicity with all our interests.�

It’s difficult to comprehend all this when one considers that when Tokyo Sexwale was released from Robben Island just 15 years ago, he had few assets. Outside his office is one of two Daimlers he keeps in Johannesburg — one for his use and the other for guests. He keeps his first, and older, Daimler bought in 1999, in Cape Town, and uses it to travel for weekends to his nearby wine farm.

In Johannesburg he lives in a big, but not ostentatious home. It’s first and foremost a family house. Above the fireplace in the main living room is a portrait of his beloved wife Judy, a petite blonde he met when he was on Robben Island. She was a young paralegal, he a political prisoner. Theirs is a love story movies are made about. Indeed, for one of her birthdays he rented out a cinema and invited all their friends. He led her into the darkened auditorium and it was only when “Happy Birthday Judy� came on with the closing credits that she realised what he had done.

Last year he bought her an eight seater Lear Jet for Valentines Day, and in it she jets to the various charitable endeavours the Sexwale Family Trust is involved in across Africa.

Its guiding principle is Vuka u zenzele (stand up and do for yourself) — he has a vision of Africa creating a new generation of industrialists that are philanthropists too. “I want to be in the Fortune 500 of philanthropists,� Sexwale says.

The Trust is negotiating to bring children from Darfur who need skin grafts for treatment in the hospital group Sexwale’s Mvelaphanda controls. It is the second largest hospital group in South Africa with 60 hospitals here and one in Botswana. But, “before that she will probably fly to Sierra Leone in that,� he says, gesturing to a model of his own jet, a Bombardier, “and fetch some children who had their arms amputated by Charles Taylor and his rebels. We will bring them back here to have prostheses fitted.

“And then, of course, we have bought half shares in a wheelchair company and will begin giving out wheelchairs nationwide.� His eyes light up and he goes into a description of how the wheelchairs work and how they will help people.

Tokyo Sexwale is that rarest of public figures. He is loved and respected. Yes, he has detractors, but they have tended to be jealous political rivals. He was Nelson Mandela’s favourite to succeed him as president in 1999 but Thabo Mbeki swiftly ousted Sexwale and Cyril Ramaphosa, who is also now a successful businessman, from the running.

Sexwale and Mandela were both on Robben Island together — Mandela spent 27 years in jail and Sexwale 15 for furthering the aims of the then banned African National Congress, now South Africa’s ruling party. He and Mandela have the dubious distinction of both being on the United States of America’s list of terrorists along with the likes of Osama Bin Laden. It doesn’t stop either travelling to the USA, but it means that before they travel they have to inform the US ambassador in person and are met at the plane, often on the tarmac in the USA, and whisked through to meetings in the White House with George Bush or Bill Clinton.

It’s a matter Sexwale won’t discuss. He simply smiles and changes the topic.

A political animal since his teens, Sexwale’s first business foray was small. He was offered a stake in a small diamond mine near Kimberley after he left public office. He was thrilled by the opportunity, displaying colour photographs of the small operation to guests who visited him in his study, a converted garage in his Houghton home that had a large screen television always tuned to the Bloomberg news channel.

In his Johannesburg offices, he has two computers at his desks — one for work, the other permanently tuned to stock market tickers. He warns that as economic conditions undergo a new revolution and China and India become the new world economic leaders, there is the likelihood of African neo-colonialism, often encouraged by African leaders. Next to his oil drillings in Equatorial Guinea for example, China has concessions for huge swathes of oil fields.

“The world is coming to Africa,� he says. “As economies grow they need resources and we have them.� Africans need to create global partnerships that work for Africans without the continent being stripped, yet again, by another colonial wave, he says.

“I’ve just come back from Shanghai and the demand for raw materials in China is unprecedented — copper, coal, iron ore, gas. When you fly over China there are new cities that have yet to be placed on maps. New York is nothing compared to Shanghai.

“Look at India, it too is very hungry for new resources. It can be an opportunity for Africa, but it needs to be accompanied by African industrialisation. African industrialists need to consolidate, we need to beneficiate on the continent. In Shanghai businessmen said to me that if they take minerals raw from our continent, they are also taking a lot of unnecessary sediment. They would rather us beneficiate and if we do, we will earn more and create jobs.�

Sexwale’s thematic frame of reference is that “political interference must be minimised so we can have the liberation of African industry. The alternative is a spaza shop mentality across a continent of no hope.�

It’s not an option Sexwale is prepared to consider. He says communications infrastructure needs to be dramatically upgraded. “People buy and sell in three seconds at the speed of laser high-tech, yet we don’t have adequate phone lines everywhere. We don’t need copper wires, we can use infra-red. We need an African revolution. We can’t make claims that this is the African century if we can’t back it up with real action … We want to see industrialists, educationists, great African universities, philanthropists.�

And perhaps the most revered woman in his life to sum it up, “My 90-year-old mother says ‘you can’t take it all with you’, we need to care and share more.�


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Sharing a link of this South African black leading businessman

http://zar.co.za/tokyo.htm

A few things standout:


"They have interests in mines in Congo Brazzaville, the Democratic Republic of Congo and Sudan."


"He and Mandela have the dubious distinction of both being on the United States of America’s list of terrorists along with the likes of Osama Bin Laden. It doesn’t stop either travelling to the USA, but it means that before they travel they have to inform the US ambassador in person and are met at the plane, often on the tarmac in the USA, and whisked through to meetings in the White House with George Bush or Bill Clinton."


“The world is coming to Africa,� he says. “As economies grow they need resources and we have them.� Africans need to create global partnerships that work for Africans without the continent being stripped, yet again, by another colonial wave, he says."