Lawrence Mavundla. File photo: Leon Nicholas
Lawrence Mavundla. File photo: Leon Nicholas

Twist in Nafcoc power battle

By THABO LESHILO Time of article published Nov 23, 2014

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Johannesburg - The bitter battle for control of the National African Chamber of Commerce and Industry (Nafcoc) took another turn this week when the Supreme Court of Appeal upheld the appeal by the faction led by Lawrence Mavundla against its expulsion from the leadership of the country’s biggest black business body.

The SCA decision, delivered on Friday, effectively reverses a decision by Judge Ramarumo Monama in the South Gauteng High Court on February 22, 2012, that had anointed the faction led by Reverend Joe Hlongwane, the organisation’s founder member.

Mavundla’s faction had applied to the court to declare null and void the resolutions of a meeting held on December 6, 2012, by a parallel structure of the business chamber, led by Hlongwane, in order to render Hlongwane’s executive unlawful.

The meeting had passed a vote of no-confidence in Mavundla and his executive. The South Gauteng High Court found, however, that the meeting had been legitimately convened and had been representative of Nafcoc’s affiliates.

Hlongwane and his faction then claimed that they had been requested by members to save Nafcoc from Mavundla and his faction, whom they had accused of illegally clinging on to office . The meeting passed a vote of no-confidence in Mavundla and his executive.

The Mavundla faction was ordered by the court to pay punitive costs, from their own pockets, amounting to thousands of rand. Mavundla’s group subsequently appealed the ruling.

The factions of Mavundla and Hlongwane have been running parallel structures of Nafcoc, and Mavundla welcomed the latest Supreme Court of Appeal decision, which was in their favour, and extended an olive branch to the losing party.

“We would like to unite Nafcoc, first and foremost. Secondly, we would like some of the issues that were not resolved in court to be resolved around the table,” said a relieved Mavundla.

At the heart of the bitter feud for control of Nafcoc is ownership and control of the organisation’s investment arm, Nafhold. “The problems started with us questioning the activities and ownership of the investments and what they were disclosing to us,” said Mavundla, referring to Hlongwane and Michael Leaf, CEO of Nafhold.

He alleged that Nafcoc members had been told about Nafhold’s R1.2 billion in Tsogo Investment Holdings. “We are wondering about about investments in e.tv, Phumelele Gaming and Uthingo.”

He said Nafhold earned over R40m a year for 10 years. “None of that flowed to the organisation.”

He said that, although Nafhold was initially owned 100 percent by Nafcoc, today the organisation owns only 19 percent, with Hlongwane and Leaf owning 59 percent and Nafcoc’s constituent affiliates owning the remaining 22 percent.

“How have they, Hlongwane and Leaf, acquired such a huge shareholding? Who did they buy it from? We never saw the money from the sale flow to the organisation,” Mavundla said.

Leaf said yesterday Mavundla was already “facing a defamation case for previous wild allegations.”

Mavundla claimed that most Nafcoc members were behind him and his fellow executive members who were elected in Joburg on September 22. The elections were supervised by the Independent Electoral Commission.

The new leadership of Nafcoc is: president, Lawrence Mavundla; deputy president, Churchill Mrasi; senior vice-president, Paul Ngema; second vice-president, Margaret Bango; secretary-general, Monga Phaladi; deputy secretary-general, Chuma Shweni; treasurer-general, Harold Phumzile Ndendela; chairperson of provinces, Mongezi Memani.

Ntombentsha Mbete, Thandile Khumalo and Zandile Nkabinde are executive members.

Dewald van den Berg, representing the Hlongwane faction, said his clients were still studying the judgment. He denied that the court had declared Mavundla’s faction the legitimate leadership of Nafcoc, saying the court had ruled that the meeting of Nafcoc held on December 6, 2012 “was not properly convened and, therefore, that any resolutions adopted are invalid”.

He added: “Nafcoc has never been a shareholder of Nafhold. It was Reverend Hlongwane and Mr Michael Leaf who, in fact, used their own money to start Nafhold, because no one in Nafcoc was interested in buying shares…

“It was only when Reverend Hlongwane and Leaf turned it into a multi-million-rand business that suddenly people laid claim to its assets. In fact, Hlongwane and Leaf are responsible for one of the biggest BEE transactions in South African history. Because of their involvement in Nafhold, Nafcoc members benefit by receiving millions of rands,” said Van den Berg.

Sunday Independent

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