GAMBLING investments king and long-time Zanu PF ally, Billy Rautenbach is at the centre of a complex global web of quick buying and selling of shares in mining corporations. Rautenbach invests and short-sells shares, which has afforded him political protection from top-ranking Mugabe allies.
Last week the Zimbabwe Independent and its sister paper, the Mail and Guardian revealed that during March 2008 elections, Lefever Finance, a Rautenbach-linked enterprise advanced Zanu PF a US$100 million loan for its campaign. This week, further searches show how Rautenbach gained platinum mining rights after Zanu PF parcelled out Anglo American’s surrendered claims to the government. Under pressure to comply with the government’s empowerment plan, in 2006 Anglo American, operating as Implats, gave up an estimated 30% of its claims to the government. Bankrupt Zanu PF then sold these for a song to its political allies and business associates.
Implats was forced in 2006 to cede sections of its Hartley and Selukwe Complexes to government as part of its empowerment drive. Government apportioned the surrendered claims into four sections with one claim in Darwendale given to British, Chinese and Russian investors including army-linked Russchrome.
Parts of the Hartley Complex that Zimplats had surrendered to government in 2006 were split into four sections. RussChrome took over the Darwendale section at the northern tip of Hartley Complex and has sought unsuccessfully to sell it.
Of the other three parts, a Chinese company called Global Platinum Group was trying to sell the claim it had acquired; a Russian company had sold part of its claim to a UK company called Amari; a Hong Kong company Cross Global had acquired some ground, while a South African company wanted to purchase part of ground.
As the Zimbabwe Independent previously reported, Russchrome is in a potential billion-dollar partnership between Russians and Zimbabwe whose interests are represented by Zimbabwe Defence Industries board member and Marange Resources Chair, Rtd Colonel Tshinga Dube and Judge Dube.
In 2007, a little-known company, Lefever Finance, registered in the British Virgin Islands, expressed interest in acquiring the then Implats’ Selukwe Complex claims. During 2008 American investors Lehman Brothers held a 14,07% share and later disposed of it while international Swiss bank, Credit Suisse bought 6% of Camec in May 2008.
As the Independent reported last week, Lefever was owned by Central African Mining and Development Company (Camec), listed on the London-Stock Exchange’s subsidiary market, Alternative Investment Market (Aim) from 2002-2009. Camec has vast mining interests in DRC, South Africa, Zimbabwe and Mozambique. Through money from an American hedge-fund, Camec then advanced Lefever a US$100 million in March, “to comply with its contractual obligations to the Government of the Republic of Zimbabwe.”
After the loan Camec, now representing Lefever together with Zimbabwe Mining Development Company (ZMDC) recieved joint platinum mining rights to the Bokai Platinum Project south west of Gweru in which the British Virgin Islands-registered company held 60% equity in Todal Mining (Pvt) Ltd with ZMDC representing the Government of Zimbabwe holding 40%.
In exchange for investing in Camec, Rautenbach would receive a 13% share in Camec. A company press release quoted by Private Eye Magazine states, “Upon acquiring a stake in the Zimbabwean platinum assets, Camec confirmed that ‘Meryweather Investments Ltd, the seller of the shares in Lefever, will on completion of the transaction hold a 13,07% interest in the enlarged share capital of Camec.’ ”
Prior to the Todal/Lefever deal, Rautenbach in 2007 had sold two of his DRC companies to Camec via his family company which enabled him to gain 7,4% equity.
“Camec has been notified that Harvest View Ltd, a company controlled by Rautenbach and his family, holds an interest in 90 926 134 Camec Shares. This currently represents 7,40% of the outstanding Camec Shares,” Camec’s statement disclosed.
With a 20-year mine life, Todal was expected produce an average of 140 000 tonnes of platinum ore per month, but it first required a $250 million investment to revive the plant. Despite Rautenbach’s enlarged ownership and a subsequent change in Camec’s ownership, little has been done by its new owners of Kazakhstan origin.
In order to raise capital, England cricketer and then chair of Camec, Phil Edmonds, sold the company to a Kazakhstan FTSE-listed mining consortium, Eurasian Natural Resources Corporation (ENRC) in November 2009. ENRC paid US$945million for Camec shares.
International rights groups have questioneed how, despite EU and US sanctions, UK Treasury permitted Camec to trade with Rautenbach. An extensive report submitted to the AIM by UK-based Rights and Accountability in Development (Raid), a human rights and responsible corporate conduct advocacy group questions how Camec’s purchase of Todal, via Lefever, could have been approved by the UK Treasury when the Mugabe government was under EU and US sanctions.
Raid asks: “Did Camec at the time of Lefever/Todal transaction notify or otherwise seek the advice of Treasury as to whether its proposed acquisition complied with the sanctions then in force, require a licence or other permission from Treasury in order to make loan finance via Lefever available to the Zimbabwean government, given that President Robert Mugabe and other senior Zimbabwean government and Zanu-PF officials were all designated under EU sanctions?
“In respect of Aim regulations, why did Camec not disclose ZMDC’s SDN status given the reputational risk presented for Camec’s share price of being in partnership with an SDN (Special Designated National)?”
The rights groups also question why ENRC did not take steps against Rautenbach as a significant shareholder under an asset freeze. Camec defended itself saying it had taken the necessary steps to notify Treasury of its intent. “As soon as the sanctions were announced Camec took appropriate legal advice and subsequently, in early February (2009), made a notification to Treasury. Camec is in full compliance with its requirements under the sanctions,” Camec spokesperson said. ZMDC was added to the US Specially Designated Nationals (SDN) list on July 25 2008, and was designated under EU sanctions on January 27 2009. Rautenbach and Merryweather were also added to the list although Rautenbach is contesting this in court.
Raid notes that ENRC will not disclose whether Rautenbach via Harvest View still hold any shares in Camec under ENRC’s 95% majority-share ownership.
While much remains to be answered as about Rautenbach’s complex mining deals, what is clear is that Zanu PF received a $100 million loan to fund a brutal political campaign run by army generals in the run to the blood-soaked June 2008 presidential election run-off which saved Mugabe from the jaws of defeat.