The ANC aimed to fund it self via selected and well positioned cardes placed within the private sector.

This was done firstly to create a funding loophole which could not be done within the ANC as the capitals raised were from within its own alliance. Secondly it ensured that the ANC would not need to rely on other companies to raise funds which could have become a risk if the private sector colluded against the ANC. Thirdly it would provide a mechanism for broad based ownership on the JSE and link private sector companies to the ANC

For this reason Ramaphosa resigned in 1996 as Secretary General of the ANC .  At the time it was stated that he fell out of relations with Nelson Mandela for not being recognised as the successor when Thabo Mbeki. This was a smoke screen as you will see below

This is how it all went down

In 1996 Ramaphosa took position as Deputy Executive Chairman of New Africa Investments Limited (“Nail”) and resigned from the ANC.  NAIL invested R7 million to start up an investment banking company called Pleiade Investment Corporation.  Pleiade was in fact a vessel used to raise capital but “publicly it was a financial advisor” and “brokered” an investment deal between SBC communications and MTN. SBC communication simultaneously entered into a joint venture investing R25m into Pleiade Investment corporation which was renamed AMB Capital.

In 1996 AMB capital acted as “advisory” to a R2.7 billion broad based empowerment deal in which the National Empowerment Corporation/Consortium (NEC) took a control in Johnnic Holdings Limited. Not only did AMB capital act as advisory but it also raised capital to the value of R2.1 billion for certain members of the National Empowerment Consortium to acquire a controlling stake in Johnnic Holdings Limited (Mutlichoice, Mnet, Hotels and Casinos).

The members of NEC mostly came from the labour unions, its pension funds and is also where most of the capital were raised (Full funding details was never made public). The R2.1 billion was mostly raised out of Labour Unions pension funds. As part of this acquisition, AMB Capital “put forward” Ramaphosa for the position of Chairman to Johnnic holdings. Considering Ramaphosa’s history with labour unions it can been seen why he was needed within the deal structure.

They were using Labour Union member pension funds in equity deals. Within 1996 (Same year Ramaphosa resigned from the ANC and AMB Capital was created) AMB Capital raised a further R1.3 billion for Ikageng Share scheme, AMB Southern African Investment fund and AMB Holdings (Parent company of AMB capital).

Various deals took place with various investment companies being created and by the end of 1997 the above broad based deals took a stake of 10% of the total listed JSE shares. When considering and acknowledge the Afrikaner took close to 20 years to achieve the same level of ownership on the JSE.

Most of the broad-based deals was structured as preferential shares varying between 3 -8% discount to listed share price values. It also saw many of these companies secure lucrative deals with Government.

Over the next decade all these broad-based deals saw Ramaphosa elected into various Executive and Non-Executive positions on the largest firms listed on the JSE. Thes roles Ramaphosa occupied helped favour these companies with government contracts and helped level their BEE status.

To mention a few positions:

Chairman

Alexander Forbes South Africa, Black Economic Empowerment Commission, Johnnic Holdings Limited, KreditInform (Pty) Limited, Sasria SOC Limited, Vancut Diamond Works

Deputy Chairman

Rebserve Holdings Limited

Executive Chairman

Millennium Consolidated Investments (Pty) Limited, Shanduka Group

Independent Director

SABMILLER PLC

Independent Non-Executive Director

CAPITAL PROPERTY FUND

Non-executive Chairman

PAN AFRICAN RESOURCES PLC, MTN GROUP LIMITED, THE BIDVEST GROUP LIMITED

Non Executive Director

Alexander Forbes Limited, ASSORE LIMITED, LONMIN PLC, STANDARD BANK GROUP LTD, THE BIDVEST GROUP LIMITED,

Vice Chairman

Commonwealth Business Council

Ramaphosa acquired substantial wealth forming part of so many executive roles within JSE listed companies. He no doubt gained substantial wealth form preferential share options. I however think it would be unfair to say that Ramaphosa did not work for his wealth. He was certainly advantage based on the circumstances of the time.

Considering the turn of apartheid, questions will remain how fair and how beneficial these deals were. Questions would be asked how much money did the ANC raise for its election campaigns and many other questions will follow. Based on our countries diversity, biased opinions and factions, the answers to these questions would certainly be polarised.

I however must say that I am disappointed that 3 years into democracy black ownership on the JSE was already at a total of 10% and today ownership is questioned. Considering that almost half of the JSE share value is foreign owned it means after three years of democracy local ownership saw almost 20% in the hands of the previously disadvantaged.

Today we have stagnated and argue who owns what. What is not argued is the wealth of RSA billionaires such as Ramaphosa. It does leave a hollow feeling that this wealth has been obtained on the back of low income earners invested pension funds. Have those poor income earners pension funds gained wealth at the same rate as Ramaphosa?

That is a question only Cyril can answer.