'Raising more than R337-million in so little time was like running around like a chicken without a head'

ONE of the surprise packages in the bidding for Johnnic by the National Empowerment Consortium was a hitherto unknown group of Cape-based business people, Siphumelele.

Founded two-and-a-half years ago, Siphumelele's 9,82% stake of Anglo's 35% stake in Johnnic is the same allocation that was last week awarded to Worldwide Africa Investment Holding and New Africa Investments Ltd, two of the most powerful black businesses in the country.

Siphumelele's stake cost it R263-million, but the group raised well over R337-million.

So when chairman Sam Montsi moans that the company's allocation of 9,82% of Johnnic's shares "was not enough" maybe he can be understood.

Montsi confesses to having an ambitious streak and perhaps the name of the company which gained such a strong foothold in Johnnic sums up Montsi's belief in himself. In Nguni, Siphumelele means we are successful.

In this case, Montsi and his team certainly were. Raising more than R337-million in so little time was "like running around like a chicken without a head". But Montsi says financial institutions were happy to support Siphumelele because it has the entrepreneurial skills which will benefit Johnnic and it has good advisers, DLJ Pleiade, in which Nail, the company controlled by Nthato Motlana and Cyril Ramaphosa, has a stake.

"The difference between most black business groupings and us is that we represent a much larger group of people," he says. This is confirmed by a senior banker at Nedbank, which backed the group. The banker says that among the black business consortia Siphumelele was the most representative.

Siphumelele was Montsi's idea. He wanted to mobilise blacks, coloureds and Indians in the Western Cape and give them the opportunity to become involved in business either by promoting the growth of their own businesses or through joint ventures. He chose the Western Cape "because I'm here" and because he thought it had been somewhat neglected from a business perspective in comparison to Gauteng.

The investment company has 79 members each of whom had to place R20 000 on the table to become part of the group. Because some couldn't raise the money on their own, they formed investment groupings. Members represent 150 000 people in as diverse groupings as fruit farmers from Pniel, women estate agents from the Cape Flats, fishermen of Vredenberg and Saldanha Bay and the Food and Allied Workers' Union.

Siphumelele already has a few deals under its belt. A joint venture with electronics company Philips will be the vehicle for a voice and data cabling franchise network.

It has a partnership with Nedbank Investment Bank, which has set aside R100-million to invest in medium-sized companies with large growth potential, and it plans to start a talk radio station in the Western Cape on the same lines as Radio 702 in partnership with Primedia.

Siphumelele is also applying for a regional television licence and there are other plans "too sensitive to talk about right now".

Siphumelele is not the only business which Montsi runs. He also has a consulting business, a property development company and an interest in a fishing company. He was previously chairman of Thebe and general manager of SAB Western Cape.

Montsi and his wife Fzila have four children. He has developed a "keen interest in birds" and likes tinkering in the garden.

Heather Formby

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