COVER STORY
Minerals, there’ s more to the man than mining. Earning his LLB from Wits in 1988, Motsepe started work at one of the largest law firms in the country, Bowman Gilfillan. In 1991, as visiting attorney to a law firm in Virginia, USA, he was exposed to several mining organisations, sparking an long-idling interest in the business. As a child, Motsepe would have daily exposure to clients of his father’ s shop, most of them miners. He decided to specialise in mining and business law.
Future Mining was built on the principle that successful mines aren’ t always the largest ones, but rather the best run. This, coupled with a dash of luck, eventually lead to what became known as African Rainbow Minerals.
In 1997, with the price of gold plummeting, AngloGold was looking to offload some of its low-performing shafts. Motsepe, always one to seize a good opportunity, jumped at the chance to buy them. There was only one problem. At $ 8.2m, the price tag proved to be too high for a black South African unable to get a loan from any banks. CEO of AngloGold at the time, Bobby Godsell, had played witness to Motsepe’ s business smarts and passion for the industry, and he took note. It was agreed that Motsepe, through African Rainbow Minerals, would be allowed to repay the price through the company’ s profits.
Within a few years, Motsepe delivered on the promise. After three years, he had managed to turn the struggling mines around, delivering a profit after only 12 months. Armed with a healthy track record, the businessman entered into a partnership with Anglo Platinum, delivering similarly stellar results. Fast forward to present time, and Motsepe is at the head of one of the largest mining companies on the continent, with revenues exceeding $ 2b and employing more than 10 000 workers.
Putting it to good use
In 2004, Motsepe founded Ubunto-Botho Investments. The aim was to build black controlled capital by being Sanlam’ s empowerment partner. The company’ s vision was two-fold. The first phase consisted of accumulating capital, while the second involves partially investing said capital in African Rainbow Capital.
ARC listed on the JSE in September of 2017. ARC and, by definition, Ubuntu-Botho Investments, consists of a 20 % stake held by broad based BEE groups, including women’ s groups, unions, and youth trusts. The remainder is held by the Sanlam Ubuntu-Botho Community Development Trust and the Motsepe Family Trust.
The initial goal is far from forgotten. More than 400 000 people have directly benefitted from annual disbursement from funds, while half the profits realised by the company will be redistributed to the community through several foundations. ARC Investments holds a portfolio valued at R4.5b, with a diverse range of investments. The majority of investments, by value, fall within the IT and telecommunications sector, with Financial Services and Agriculture and Food Production rounding out the top three.
In March of this year, ARC partnered with Barloworld and Atterbury in the redevelopment of the Barlow Park Campus, in Sandton. Each party holds one-third of the landmark site, with investment value expected to climb to well over R3b as the full development is rolled out. Upon completion, it is set to be a 130 000sqm mixed use precinct.
The site is in the process of being rezoned, a process that could take up to a year. Subject to this, the site development will include approximately 55 000sqm of offices, nearly 800 residential units, a community retail centre coming in at around 10 000sqm, along with a hotel and gym. Once zoning approval is obtained, the development is expected to follow a 6 to 8 year development timeline, being phased out according to market demand.
With investments in all the key sectors of the economy, Motsepe seems to embody what it means to have one’ s finger on the pulse of innovation. In a rapidly evolving world, and an uncertain local landscape, knowing when to pounce is what sets the masters apart from the rest.
SOURCES Forbes, Bloomberg, Startup Tips, African Rainbow Minerals, African Rainbow Capital, PayProp, Tyme, Val de Vie, ooba,
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12 MAY / JUNE 2018 SA Real Estate Investor Magazine