Brett Kebble
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» Exclusive: First interview with new JCI CEO, Peter Gray
» Brett Kebble pinned down
» Froneman guns for Kebble
» Kebble facing Western Areas putsch
» Kebble's house of cards
» Kebble's last stand?
» Western Areas share price takes a hit

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Kebble dethroned
Brendan Ryan
Posted: Tue, 30 Aug 2005

[miningmx.com] -- Brett Kebble has officially quit as CEO of JCI, Western Areas and Randgold & Exploration (Randgold) in return for Investec Bank putting up R460m to re-capitalise JCI and allow the Western Areas’ rights offer to go ahead.

But it’s clear the long-running saga still has a few twists left in it with Aflease CEO Neal Froneman immediately attacking the newly-appointed JCI CEO - Peter Gray who was formerly CEO of Tlotlisa Securities.

Gray, in turn, says one of his immediate priorities is to "seek redress" from empowerment company Kabusha for the R70m to R80m that JCI must pay to former Aflease chairman Peter Skeat.

JCI stood surety for that debt along with Cape Town financial institution Trinity Holdings whose CEO - Quinton George - has now aligned himself with Froneman.

The guts of the deal thrashed out are almost exactly in line with the widespread speculation of the past two weeks except for some of the technical detail.

Investec will make a loan facility of up to R460m available to JCI through a special purpose vehicle. The money will be used to pay off Skeat; allow JCI to follow its rights in the Western Areas offer and underwrite up to R250m of that rights offer.

Western Areas had initially indicated it would raise R730m but now says it will raise only R639m through the issue of 35,5 million shares at a price of R18 a share. That’s a discount of 18% to the R22 level at which Western Areas shares ended trading on the JSE on Tuesday.

Kebble will step down completely from the boards of Randgold and Western Areas but will remain a non-executive director of JCI in which he holds a stake of around 12% stake in his personal capacity.

He could not be reached for comment last night but has issued a lengthy statement through spokesman David Barritt. In it Kebble comments; "These adjustments signal the start of a new phase in my life. I remain passionately committed to the principles that have informed my business career to date, in particular the transformation of the South African mining industry and the creation of an empowered capital base."

Reflecting on his turbulent career Kebble adds; "After a period of deep introspection, and not withstanding the rough and ready ethos that is characteristic of our industry, I believe that some of the bruising corporate and personal battles that have taken place on my watch, while unavoidable, might have been handled in a less confrontational way.

"I have therefore attempted in recent months to mend some fences. Separate announcements will follow in due course in this regard."

Froneman is objecting to the appointment of Gray as CEO of Randgold and JCI as well as the appointment of Chris Lamprecht as financial director of both companies.

He comments; "The structure of having the same executives at two-non related companies is fundamentally flawed. It is inappropriate to purposely place individuals in a position of conflict when there are related party transactions between these companies
The structure... is fundamentally flawed
"These two individuals have strong historical ties to Brett Kebble and have been associated with some of the transactions that we have raised in the requisition to the Randgold board. We are not satisfied they are the appropriate people to provide us with an independent assessment of the recent dealings of Randgold. "

It’s understood there are business links between Kebble and Tlotlisa via one of the black empowerment companies that Kebble has funded while Lamprecht is viewed by Froneman and some other industry executives as a Kebble employee.

Bottom-line concern is the situation is less than "arm’s length" which may or may not be a problem depending on what else might subsequently crawl out of the woodwork at JCI and Randgold.

Sources close to financial institution Allan Gray - which holds stakes of 25% across the Kebble companies and which will follow its rights in Western Areas - say Allan Gray approved the appointments of Gray and Lamprecht and does not view them as a problem.

As part of the changes at JCI the auditors - Charles Orbach - are being replaced by KPMG which will carry out the 2005 year-end audit. The audited 2005 annual report should be posted on or about September 30 at which time JCI will apply for the suspension of its shares on the JSE to be lifted.

It’s not mentioned in the statements released on Tuesday but Investec Bank is also currently managing the sale of the Letseng diamond mine in Lesotho which, after the 50% stake in South Deep, is JCI’s only other real asset. JCI has a 40% stake in Letseng.

Diamond industry sources reckon the mine could be worth between R500m and R1bn. Investec Bank executive Dennis Tucker says a short list of bidders will be announced later this week.

Key question is whether Brett Kebble can pick himself up from what amounts to his third major setback since he burst onto the mining scene in the mid-90’s.

The first two were the original demise of JCI in the late 1990’s when he was running it with Mzi Khumalo and then his loss of Randfontein Estates to Harmony.

This time around he has lost control of his last real assets - South Deep and Letseng - and also, it seems, the support of father Roger who is now running gold company Simmer and Jack. Last week Simmer and Jack pointedly stressed that it had "effectively distanced itself from the influence of the JCI group."

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