At some stage in the not-too-distant future it really would be useful for a corporate governance student to undertake a cost-benefit analysis of the life of ElementOne.

Ahead of a detailed study it is hard not to assume that the benefits of ElementOne’s bizarre existence accrued largely to Terry Moolman, the controlling shareholder of Caxton, and to Danie Vlok and his co-directors at ElementOne.

The costs were picked up by the shareholders of the former Avusa, from which ElementOne was spun off, and the minority shareholders in ElementOne.

ElementOne, which is essentially the by-product of an asset-stripping exercise carried out at Johncom several years ago, should never have existed.

At one time Johncom, which was renamed Avusa and later still Times Media Group, was a substantial company and carried the hopes of those who believed in the transformative powers of black economic empowerment.

It had stakes in MTN and DStv/M-Net SuperSport, as well as a significant holding in Caxton. In addition, it owned and managed 50 percent of BDFM, 100 percent of Exclusive Books and Nu Metro Cinemas.

In 2003, the sale of the MTN stake generated a hefty cash boost for Johncom, although not as much as it would generate today. For a few years after that the cash-generating ability of DStv/M-Net SuperSport took the pressure off the Johncom and later Avusa management to actually make money from their own businesses.

Allan Gray and Coronation, two of the largest shareholders in Johncom/Avusa, eventually got fed up of this and decided it would be better to sell the pay-TV stakes to Naspers, which controlled and managed these assets. Allan Gray and Coronation both held stakes in Naspers.

This deal was followed by the decision to hive off the Caxton investment into its own listed entity, ElementOne in 2006. The challenge for ElementOne was that it was a “single asset investment holding company with a 39.38 percent direct and indirect stake” in the listed Caxton group.

In 2008, it was forced to delist because it had no independent operating assets and it then traded in the over-the-counter market. That strange existence is now set to end. (The story continues…)


It is clear that retailers are not having a good start to the year, including South Africa’s leading supermarket, Shoprite. But low-end consumers are in for a tougher year than shareholders.

The low-end consumer is described as a low-paid individual who is dependent on public transport and store credit accounts.

Shoprite’s slow growth in retail sales for its local supermarket division is a direct match for the consumers that are affected by factors including high fuel prices, high indebtedness and tighter access to credit.

To some extent it does give an indication of what lies ahead for retailers. Analysts pointed out different reasons, among them being the fact that competitor Pick n Pay was back with a bang.

We shall see whether that is true or not.

But one thing that retail analysts agree on is that for many months Shoprite has not had strong competition locally and it is now reacting to Pick n Pay’s re-emergence.

“Pick n Pay has a new chief executive, Richard Brasher, who is bringing on change that will be, and has started, challenging Shoprite,” an analyst said.

Shoprite has not been hit only by low consumer spending. Its strategy to reinvest in its price points is also taking a toll on the retailer’s margins.

One analyst said the consumer needed Shoprite, but maybe the supermarket chain needed the consumer even more.

On the other hand, high-end consumers, which in the world of retail are measured by Woolworths’ performance, are fine. The numbers seem to have impressed the markets and it is agreed that top-end consumers are “doing okay”.


Could the strike looming across the platinum sector and parts of the gold sector be a make or break stand for the Association of Mineworkers and Construction Union (Amcu)?

Built around the demand that entry level pay in the mining sector be fixed at R12 500 a month – the same demand that led to 44 people dying, including 34 from police bullets, at Marikana back in August 2012 – the strike could see 90 000 miners down tools from Thursday, costing mining firms R200 million a day in lost production.

One would expect that Amcu, which has been planning the strike against Lonmin, Anglo American Platinum and Impala Platinum since late last year, would take the field united under its blood-soaked banner. But no. Yesterday disgruntled Amcu shop stewards along with the Workers and Socialist Party (WASP), who have been stoking and exploiting deep-seated discontent in the festering communities around the mines since the Marikana killings, accused Amcu president Joseph Mathunjwa of leading a strike without a strategy.

Mathunjwa’s reply was that the disaffected members were sowing divisions after being paid R2 million by mining bosses. Hardly a picture of workers united.

Meanwhile mining houses are seeking an interdict, at least for the gold mines, to have the strike declared unprotected because everyone except Amcu accepted an agreement reached last year, which has also been benefiting Amcu members.

And why set off a new round of industrial turmoil, and – if past performances are any guide – more bloodshed, with a national election just three months away?

International observers, already bemused, confused and a little bruised, by South Africa’s enthusiasm for industrial self-destruction are poised to at least give the rand another thrashing if the strike is prolonged or violent.

Many questions. Not least is: who wins?

Edited by Peter DeIonno. With contributions from Ann Crotty, Nompumelelo Magwaza and Peter DeIonno.