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Zuma’s son says he’ll quit Gupta mining firm in South Africa

South African President Jacob Zuma’s son said on Friday he would sell his investments in a mining firm owned by friends of his father amid speculation that the wealthy family is wielding undue political influence.

Duduzane Zuma’s announcement came days after First National Bank, a unit of FirstRand, joined three other South African companies in quitting as bankers and auditors of companies owned by the Indian-born Gupta family.

In a memo to staff seen by Reuters, Oakbay Investments – a holding company for Gupta businesses in South Africa – said it had approached government departments including Zuma’s office to express “deep disappointment” over decisions by banks to close its accounts.

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The Presidency and Oakbay did not immediately respond to requests for comment on the content of the memo.

Citing “aspersions” against his own family, Duduzane said he would also step down as a director of Shiva Uranium, the main subsidiary of Oakbay Resources, which houses the Gupta family’s mining assets.

“I have decided to relinquish all positions that I hold at Oakbay companies and am exiting investments to preserve the jobs of Oakbay’s thousands of employees and to de-politicise my participation in business,” he said.

The mine is 26 percent-owned by Islandsite 255, a company of which Duduzane is also a director. It employs 648 people, the family said last month.

Last month deputy finance minister Mcebisi Jonas said the Guptas offered him the position of finance minister shortly before Zuma sacked then finance minister Nhlanhla Nene, in December, a move that sent markets into a tail-spin.

Zuma has denied suggestions the Guptas wield undue political power. The Guptas have also dismissed such reports, saying they are pawns in a political plot to get Zuma out of office.

Oakbay Resources said in a statement that chairman Atul Gupta and chief executive Varun Gupta had resigned with immediate effect. “This decision follows a sustained political attack on the company,” it said in a statement.

The firm said it had created 3,500 jobs in South Africa’s mining sector.

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“SMOKE AND MIRRORS”

Oakbay Resources’ statement did not say if the resigning members of the Gupta family would reduce their shareholdings in the company.

South Africa’s elite police investigating unit, the Hawks, said last month it had launched a corruption probe into Duduzane and the Gupta family.

South Africa’s main opposition party, the Democratic Alliance (DA), dismissed the resignations of Duduzane and the Guptas as an “exercise in smoke and mirrors” to protect their assets and profits.

Citing association risk, the local unit of global auditing firm KPMG cut ties with Oakbay Resources last month. Other companies that have severed links are investment bank Sasfin and lender Barclays Africa.

Oakbay Resources said it was being serviced by an Asian bank that did not want to be named.

The three Gupta brothers moved to South Africa from India at the end of apartheid in the early 1990s and went on to build a business empire that stretches from technology to the media to mining.

Zuma survived an impeachment motion by the opposition on Tuesday thanks to his African National Congress party’s majority in parliament.

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Source: reuters


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SA company helps set up defence plant in Saudi Arabia

South African defence company Rheinmetall Denel Munition (RDM) has helped set up a munitions manufacturing plant in Saudi Arabia in a venture with that country’s Military Industries Corporation (MIC), the Saudi Press Agency has reported. According to MIC head Mohammad Almadhi the establishment of the plant cost some $240-million and it was built under licence from, and with the assistance of, RDM. The new factory was opened on March 27 by South African President Jacob Zuma and by  Saudi Deputy Crown Prince Mohammed bin Salman bin Abdulaziz.

(Prince Mohammed is also his country’s Second Deputy Prime Minister, Minister of Defence and Chairman of the Board of Directors of the MIC). The facility is located at Al-Kharj, in central Saudi Arabia, south of the capital, Riyadh.

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The plant will manufacture 60 mm, 81 mm and 120 mm mortar bombs, 105 mm and 155 mm artillery shells and aircraft bombs ranging from 226 kg (500 lb) to 907 kg (2 000 lb). It is composed of nine industrial buildings, each with its own specific function, including heat treatments and surface treatments, assembly and filling, processing, packaging, destructive and nondestructive testing. According to Almadhi, the factory has a production capacity of 300 artillery shells or 600 mortar bombs a day.

It will be staffed by 130 engineers and operators. He further noted that his company was now able to make many different defence products. RDM is a joint venture between German defence group Rheinmetall Waffe Munition and South African State-owned defence industrial group Denel and was created in 2008. Rheinmetall holds 51% of RDM and Denel the remaining 49%. RDM describes itself on its website as a company that “specialises in the development, design and manufacture of large- and medium-calibre ammunition families and is a world leader in the field of artillery, mortar and infantry systems as well as plant engineering”.

The Middle East is one of its target markets.

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Source: engineeringnews


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