Tim Cohen And Chantelle Benjamin
10 October 2003
Johannesburg — IT IS well known in mining circles that deal-making is mining entrepreneur Brett Kebble's first love in business at least, and possibly outside too.
But of all the morass of mining deals in which he has been involved, one stands out and has haunted his career since.
The deal, in 1999, was supposed to involve the construction of a simplified, logical structure for the many mining houses in which the Kebble family had minority stakes.
It was supposed to be a cleanup act. Instead it went horribly wrong.
The intention was to buy a single company, and then to use it as a vehicle to buy out minorities in a series of other companies through a process of share-swapping and cash payments.
At a formal level, this necessarily involved an offer by the vehicle to buy the companies that would eventually become subsidiaries.
And that involved establishing a value for the subsidiaries.
The target in this case was Randfontein Estates and the offer was made by JCI.
But what often happens when one offer is made, others jump in, and no sooner was the scheme announced than rival Harmony did exactly that.
The state's case against Kebble, his father Roger and the then financial director of JCI, Hennie Buitendach, is that they illegally borrowed about R114m from a company the group partly owned, Western Areas.
The money was loaned to Durban Roodepoort Deep, where Roger Kebble was then chairman, and was allegedly used to drive up the share price of Randfontein, while at the same time short-selling Harmony shares to force its share price down. The intended effect would have been to make Harmony's offer appear less attractive than JCI's.
Brett Kebble was censured by the Western Areas board and stepped down, but returned as CE a year later.
The case has now trundled on for four years, as the sides apparently struggle to agree on an pleabargaining settlement.
But it is now coming to trial, and will be heard in the Johannesburg High Court on Monday.
Brett Kebble told a press conference that the charges related "to allegations about technical breaches of company regulations".
He said the head of the National Directorate of Public Prosecutions, Bulelani Ngcuka, had sought to elevate these technical breaches to charges of fraud, despite the fact that no loss was suffered by any party.
Brett Kebble said that he was being hounded for a matter that usually carried a fine.
"The bottom line is that I am a victim of competitor-driven strategies designed to keep me out of the commercial world for as long as possible while a tainted process was placed in motion to prosecute me."
The case is the result of a report completed by the Financial Services Board, which was handed over to the directorate in June of 2001.
Brett Kebble initially attempted to plea-bargain with the prosecution, led by Willem van der Linde, in which Kebble is understood to have offered to pay about R2,5m in a proposed out of court settlement
This was against the state's demand that Kebble endure a prison sentence for contravening section 40(c) of the Companies Act a judgment that would have prohibited Kebble from holding any positions of public office, including future directorships of any public company.
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