COMPANIES
Metallon bags R70m on BEE deal
Posted Thu, 18 May 2006
Mining group Metallon, owned by controversial businessman Mzi Khumalo, is alleged to have made a R70-million profit out of a black economic empowerment deal with construction group Basil Read, Business Day reported on Wednesday.
According to the report, Metallon's Khumalo and former Scorpion's boss Bulelani Ngcuka entered into a BEE deal with Basil Read, but Metallon proceeded to sell the shares — bought for 82 cents per share — for up to R7 just eight months later.
The selling of the shares is said to have netted Metallon profit of R70-million, or some R40-million after funding costs.
The question now is whether Basil Read had been tricked into believing that Metallon was to be a long-term BEE partner, even though all Metallon's Read shares had been sold in just eight months.
Metallon CEO Andile Reve told Business Day that his outfit never pretended to be a BEE partner "in the classical sense".
Basil Read's 51 percent black-ownership has now been reduced
to just 36 percent.
| 
