Sekunjalo Investment Holdings rebuffed an approach by the Gupta family, which is in business with members of President Jacob Zuma’s family, to take a stake in South Africa’s Independent News & Media group, according to Iqbal Surve, Sekunjalo’s chairman.
Surve said he stopped considering bids from the Guptas and other politically connected entities when the Public Investment Corp., Africa’s biggest fund manager and part of the group which owns the Independent group of newspapers, objected to any changes in the shareholding.
“We will not be allowing any other party to come into our consortium,” Surve said in a phone interview from Cape Town today. “We won’t be selling any of our assets, any of our titles or otherwise.”
A group led by Surve’s Sekunjalo, which includes the PIC, the company that manages the pensions of South African government workers, and the China Development Bank, agreed in February to buy the South African operations of Independent News & Media Plc, Ireland’s biggest newspaper publisher,for 2 billion rand ($196 million). The assets include some of the country’s best-selling daily newspapers, including Johannesburg’s Star and Cape Town’s Cape Times newspapers.
Johannesburg’s Mail & Guardian, which publishes a weekly newspaper often criticized by the government, also approached Sekunjalo unsuccessfully, Surve said.
“There are questions whether we are going to come under any political pressure to take in the Guptas or anyone else,” Surve said. “I think the PIC is saying it’s a commercial operation and so they won’t allow any changes in the consortium no matter who it may be.”
The PIC will “under no circumstances whatsoever” consent to a change to the shareholding of the Independent group, the fund said in an Aug. 21 letter to Surve signed by Chief Investment Officer Daniel Matjila.
The Gupta family has hired one of Zuma’s sons, Duduzane, to serve as a director on the boards of their Sahara Computer and Shiva Uranium businesses, while one of Zuma’s wives works for their JIC Mining Services business.
Mandisa Makinana, a personal assistant to Atul Gupta, a senior family member, and PIC spokeswoman Namzamo Petje declined to comment and asked for e-mailed questions when called.
Their New Age daily newspaper was this year criticized by the opposition Democratic Alliance for being paid by government utilities to host events to showcase the companies. The family also started a 24-hour, Johannesburg-based television news channel last month.
Earlier this year the Gupta’s issued a public apology after an Airbus carrying guests for a wedding of one of their relatives in South Africa landed at the high-security Waterkloof Air Force base near Pretoria, the capital. The facility is reserved for use by the military and government. Zuma denied authorizing the landing and blamed lower-level officials.
Sekunjalo will use its stable of software designers to help the Independent become a more technologically savvy media group, simulating what billionaire Koos Bekker has achieved with Naspers Ltd., the world’s largest emerging market media company, Surve said.
“If we do a little bit of what Koos has done, we’ll do amazingly well,” he said. “We’re buying at the bottom of the cycle. We’re seeing a fantastic convergence of technology and print.”