Pravin’s portfolio of shares reveals much about state capture


The writer has analysed Pravin Gordhan’s portfolio of shares – banking and real estate – and exposes the influence they have on the state. Les Ma-Ada can be reached on Twitter on @lesmorgp

In recent history, the buzz word in South Africa has been #StateCapture. The President has been accused, primarily by those who support Finance Minister Pravin Gordhan, of been captured by the Guptas. The public has readily accepted this information without stopping to seek a counter balance. If there’s anything I’ve learnt in life, it is that no-one is ever right all of the time. If they are then they can only be conmen.

It was therefore with interest that I read the contents of the finance ministers register of assets to Parliament.

Gordhan_sharesIs it really possible for an entity to capture the interests of a finance minister and manage to keep this from everyone? Our transparency laws make this diffcult to achieve unless the minister or his cohorts are cunning. The short answer is that an enity wouldn’t be able to do so. However that doesn’t stop a “loose’ structure of seemingly random participants from being able to do so. But even they would have to ensure their actions were not seen as having occurred in concert. Simply put, co-incidents. The problem is, there is no such thing as a random occurence. Even co-incidents require two (CO) or more to act in concert.

The finance minister’s shares reveal a Capture of the State at a special level. The conquerers have become so enmeshed in the state that it becomes opaque for an outsider to recognise that the state, and all its instruments, continue to be directed from elsewhere. In my view, pressure brought on Pravin reduces his independence and he would be inclined to make decisions for the benefit of Capital and not necessarily for us as a nation.

Given the myriad of shares that he holds, I wish to focus on a few that point me in that direction. Real Estate and Banking (Specifically the Preference Shares).

Gordhan’s Preference Shares in banks

Preference shares by their nature are shares one holds as security for some sort of loan one has made to the entity, not in the ordinary course of business. In other words, these shares are different from Ordinary shares in that the risk undertaken by their holder is specifically mitigated through a percentage return and not through an uncertain dividend declaration. In return, the entity gives those shares preference over Ordinary shares when profits are realised, or in the worst case scenario, when the entity is wound up. Hence the name Preference. It was with this eye that I wanted to know why the Finance Minister would hold Preference shares in Banks that he is entrusted to oversee. Turns out that Bank Preference shares are an interesting animal.

Lets begin by dealing with the latter part of my statement on when payouts are due. In the manner that these shares are structured, they only pay when Profits are realised. Remember, these are equity instruments. The bank carries no interest rate risk nor does it pay when there are no profits. Apart from the Monetary Policy Committee (MPC) who else determines whether banks make or lose money? Why – it’s our Finance Minster, of course. That’s a handy thing to have. A Finance Minister with a vested interest in the outcome of your very private business.

Bank Preference shares until say 2013, were seen as Tier One shares. In simple English, these Tier One shares are made up of: (1) Shareholders Equity and (2) Retained earnings. Shareholders Equity or in Standard six Accountancy, Owners Equity (we could get technical, but this is the Nett effect), and Retained Earnings being profit after tax and dividends. It therefore stands to reason that Gordhan holds shares in banks while also holding the status of fractional owner. Not just any owner but one with a special concessionary relationship.

Conflict of Interest

In governance terms, it shouldn’t matter how many shares he holds. How many is ever enough? Should a guy tasked with running a department that directly interacts with the banks on many levels – especially the important issue of the Financial Intelligence Centre (FIC) – the same one that failed to see that the banks were rigging interst rates for years, hold shares in the entity that he’s supposed to be regulating? Conflict of interest much!

Banks bidding for their own mole 

Another way to look at this is that when Des van Rooyen was fired after that 4 days in December and replaced with Gordhan, the banks were actually bidding for their own mole. But hang on, that’s not where it ends. Its never that simple in South Africa. Trevor Manuel ran this department for many years before being replaced by Gordhan.

Here’s an interesting bit – essentially, the structure of Gordhans shares (share portfolio) which I looked into is such that the banks buy shares in each other. The shares are then used, I suppose as a hedge against profits made by the others, or losses that could be realised. I’m not sure what the rationale is but I can tell you that it has money-making at the end of it.

I suddently understood why under Basel III  http://www.investopedia.com/terms/b/basell-iii.asp, these shares were being phased-out. What is interesting is that the period of buy-back or phasingout is 10 (ten) years. That should be more or less the time Pravin would need to set his policies in place such that his Ordinary shares at the same banks will give him a healthy annuity till the end of his days. And how would he go about ensuring that? Hand the South Africa Social Security Agency (SASSA) account to one of the Big Four banks. My bet is that Maria Ramos at ABSA – wife of Trevor Manuel who has run the finance ministry forever. That’s just my view. You’ll be able to draw a parrellel later on.

Grindrod Bank & SASSA

In one of Gordhan’s portfolios was a certain Grindrod. It seemed strange to me that the entire portfolio would hold Banking shares – and then this diversified entity called Grindrod. Then looking deeper I realised that Grindrod was actually Grindrod Bank.

Why Grindrod bank? Simple. Grindrod banks SASSA. Yes, I said SASSA. Look it up before you take my word for it. Who cares who’s making R16 or R 25 per transaction when you could be making returns on the money banked on behalf of SASSA. Yes the profits are also a factor. R 3 427 200 000 (Three billion, four hundred and twenty seven million, two hundred thousand rands), but can you imagine service fees. All those below the line costs none of us bother to look at? It doesn’t matter, you make lots of money come dividend season.

Gordhan’s Real Estate Shares

SASSA had appeared earlier when looking at the Real Estate shares. Rebosis, seems to hold a portfolio of buildings whose main clients are government departments. In one building in the North West Province, SASSA is the main anchor tenant. In another, the National Prosecuting Authority (NPA), and in yet another they are directly advertising to a Governement departments, as the space can be used as a Revenue department…. methinks they mean SARS. Who gets final say on the budgets before these buildings go to “tender’? I don’t have to tell you who signs the budgets.

You see, when I was looking at the Real Estate shares, I was thinking small fry. I was thinking that shares like those held in Rebosis and Fortress, which is a sister fund to one known as Resilient, both holding lots of rural type shopping centres. I was thinking like a rural centre developer and not as a Property owner. Check this out:
In setting up one of these shopping centres you need to create a psychological reason why people should come to your centre. The ANC has often been criticised for using the grant system to entice voters. The reality is that rural economies are all but decimated, with farming not performing as it should or continuing to exploit the masses. However social services, such as clinics, Post Office or SASSA pay-points, are the biggest drawcards to get feet into these centres.  So, who actually benefits? Is it the ANC through votes every four-year cycle or is it your Shoprites, Pick n Pays and Boxers (who actually belong to Pick n Pay)?

Let me show you something: You find a piece of ground near or on a taxi rank. Add social services and suddently your large national anchor stores are there in a hurry. So you often find post offices and SASSA offices there too to guarantee feet and also to guarantee your Shoprites that on pension pay days, their businesses will boom. I expect business to make money off the government but I just didn’t expect to find them doing it so boldy as to have the Finance Minister hold shares in their entities. After all this man is supposed to be above reproach.

One of the the shares that Gordhan holds is in a Real Estate Company called Growthpoint. On the surface of it Growthpoint is misplaced. They don’t operate in the rural and township sector. They own A grade malls like Hydepark and the like. In 2011 with Gordhan at the helm of treasury, government through the Government Employees Pension Fund brought 50% of the V & A Waterfront in Cape Town. The PIC through the Government Employees Pension Fund owns the other 50%.

In the world of finance, the story is in the “term sheet’. This sheet holds the story behind the terms of the deal which is later turned into a contract. How Growthpoint came to hold 50% of a building bought for R9.5 billion made dig a little deeper.

The V & A was sold to Dubai World in 2006 for R7 billion odd. Its previous owner was Transnet, Maria Ramos was the GCEO and Trevor Manuel was the minister of finance. In other words, the building belonged to the Pensioners of Transnet. Sold for R7 billion odd and then another group of Government Pensioners bought it for R3 billion premium and brought it back to South Africa. In finance and property terms, that looks like a property flip! In simple life terms, that deal was done in the short term.

Buy for cheap at one price and flip it for a quick profit in a short time horizon. In this instance, it was 3-4 years (I believe short term to be a period between 3-5 years). Who lost money? The Pensioners. R3b to be exact. They also lost out on the annuity income from the centre and the stripping of the rise in equity value of the asset.

You see, when you go through media reports of the time during which Dubai World owned this property, it’s clear to see that they were using this asset as a cash cow https://mg.co.za/article/2011-06-10-tenants-gatvol-of-the-va-waterfront. Tenants complained about a drop in service levels and general apathy by the new landlord despite this being South Africa’s premium and Africa’s most expensive piece of retail shopping centre. You don’t run a crown jewel like that unless there’s a back story. In any case, even with the bad management the property value went up. And this was during a recession.

Here’s a business question: Would Growthpoint buy this property at a loss? Would their shareholders allow them to pay a premium for this building given the above discussion? Hell no! They would have driven the price down and picked it up for less than Dubai World paid for it were it not for the BEE group involved in the repurchase. With BEE, you can create value where there is none. The money would have to be real cheap and they would have made sure that they put as little skin in the game as possible. Without being privy to the term sheet I can tell you that the pensioners got jacked. Pravin would have, again, been intimatly involved in this repurchase as the money came from one of his state owned enterprises (SOEs). It was Pension fund money and given that it was a public-private-partnership (PPP), he should have asked for a cheeper deal. But how can he when he’s a shareholder? Someone must open the files for us to see the intimate details.

The Gordhan/Manuel tag-team over another deal! Perhaps this is co-incedence, but I don’t believe in co-incedence.


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  1. Surely your argument is beyond just the finance minister? If you apply this logic, then all public servants must be under the spotlight. And at what level do you separate the interests? All government employees have a pension fund which then invests these funds on behalf of the employees – does this also mean that there is a conflict of interest? I would be very keen to hear your recommendations about how public servants can participate in the economy without bridging the veil of interest.

    Remember, according to the PFMA, not all money spent must be approved by Treasury. So whether you are finance minister or not shouldn’t matter.

    1. This was an attempt at narrowing the issue to a single person. You have to remember that in a court, you must narrow the issue to make it easier for law enforcement to deal with the matter. In the play ground you may get away with “ma’am, so did John, Sipho and Lucky”. In life you need a single party to then follow the string. Le godu ke le tswereweng le morwalo. There’s a lot of wisdom in that ediomatic expression ya seTswana.

  2. People
    Who r we trying to protect here? Moja sa gae wa ke phihla. Omong ena oretswela ka marapo a nama reja ka morogo.

  3. Why was this information not given as a reason for removing the minister from office?This information is a matter of public record!Politicians are required to declare their financial shareholdings, investments etc. I can’t believe Mr.Gordhan would be involved in something that would jeopardize all he has achieved in the “struggle”, for unlawful financial gain!!

  4. I would rather have a small looting Pravin than a Jacob who will have my kids in debt to Russia for a nuclear deal which they can’t afford.

  5. It’s nw an open secret dat cde PG was nt appointed by JZ; bt the Oppenheimmers nd Rupperts thru mr Ramaphosa whom collectively; are being handled by the western, me, being apolitical prsn, m nt suprised at the differences in d top 6

  6. “Preference shares by their nature are shares one holds as security for some sort of loan one has made to the entity, not in the ordinary course of business.”

    I am actually considering laying a fraud case against you Pinky. I’ve reached the point where I am fed up with how people share disinformation.

    Frankly, you don’t have a clue how preference shares work, most definitely not LISTED preference shares. Did you do two simple things that any reputable journalist will do?

    1. Check on the specific terms of these shares. Very easy to find.
    2. Check when Gordhan acquired these shares.

    Coincidentally, do you find it strange that a minister of finance holds a diversified share portfolio, that includes some of our biggest and most successful companies? If you do, you don’t have any sense of finance or business. Maybe worth checking on Gigaba (his situation should alarm you more).

    Further, Gordhan does NOT own any shares in Grindrod. So much is clear from the declared interests. Correct, page 127 on the register of interests. Do you have any other sources you would like to share? From my knowledge we are using the same and only source. This is in other words, based on this Register of interests a COMPLETE FABRICATION.

    If he was captured, surely it would have made sense to make sure the contract with SASSA get’s extended ASAP? How can’t you see such simple realities?

    Why are you misleading normal law abiding people?

    I don’t have time now to go through the rest of your fabrications.

    Your ignorance on facts is no excuse when you use a platform, such as this, to be libelious, when you don’t have an idea how listed preference shares or preference shares in general work.

    May I suggest you also contrast Gordhan’s salary as minister (R2.3m) against his salary as normal MP (R1.04m) and figure out which capture would have been the most lucrative to him. Correct, that of Zuma and the Guptas.

    You’ve been put on notice. Fraud is a criminal offence. And a distortion of facts, when you are supposed to do the due diligence before publishing, is fraud.

    Maybe your intentions are pure and you are just totally ideologically blind and ignorant and writing about topics you really don’t know anything about. But, since you are busy misleading the public (your fabrication on Grindrod is a perfect example) and since this is a criminal offence, you just have to deal with the consequences as they happen to find you. Maybe you’re a friend of Zuma and he will help you out with this one, since he also controls the NPA via Abrahams.

    1. It ironic that shortly after this was published the banks no longer listed openly the make up of share’s in a portfolio of shares. Perhaps if you play stocks, you can ask them for the portfolio made up of the shares I wrote about. It wasn’t a thumb suck. Of that I can assure you.

      Secondly, I don’t know what fabrications you speak about, but at this stage in my life I am prepared to meet you toe to toe. I am sick and tired of apologists like you who drive a narrative to suit their wallets. You and I must meet on this one if you have a problem with my extrapolation.

      Thirdly as pointed out, does it matter when he acquired the shares? Why does it matter. What matters is whether it could be inferred by a reasonable person that ket decisions are taken on the basis of this holding. Can you make a counter argument? You are aware that we have freedom of expression. Its in the bill of rights you ignorant fck!. Slander is when people make sht up. All I said was whether this holding could be construed to have an impact on the Ministers decisions. That is a question…ignoramus!

      The problem with people like you is that you believe that you are the receptacle of all truths. And no you are not. You are just some ignorant, empty vessel who can read and write in english.

      As to whether capture would ensure that the contract is extended… where are we today in 2020? Secondly that would be slander if their were no facts. As at the time this was written, there were and remain no facts as to what drives the decisions. However I will continue to ask questions that could have others less dense thinking about the value of who we place in Parliament.

      As to fraud… You are a fool of no common description. Where is the fraud in an Uncensored OPINION???? Fraud speaks to false pretence. There is no false pretence here, but if you want to, leave a message on these pages and I will give you my full details so you can open a charge against me as the author, and we can duke this out. I will not be cowered by morons.

      Get your facts straight fucker before making airhead comments. I stand by what I wrote about Grinrod and the Banks in this regard.

      A further illustration on this matter is that the interest is not even a factor. The money multiplier is. Go educate yourself before running your ignorant mouth over hear.

      Now you have been put on terms!!!!! COME!!! Back it up with your big mouth. Let you and I unravel this “democrazy”.

  7. The BEE partner that bought shares in growth point and funded by PIC seems to be benefiting always in those deals that are set up.I am not versatile in the terminology used here but have been following that BEE partner , who has also recently gotten a large share of what dti payed prime for but now for a song. They seem to be the only beneficiaries of choice even when those that are involved in the space have interest. IDC in December no gal made a quick adjudication of the almost 90% to this same consortium. It is for me worth unbundling as well. Please just check out.

    1. Dear Carlie

      Thanks for the heads-up. We will check it out. But if you have more information please assist us – our resources are very minimal and whatever assistance we can get in terms of the information the better for us.



  8. It is important to be aware of power systems at play, so this article covers an important topic, not often covered in the mainsteam media.

    Regarding preference shares however, it is worth noting that while these instruments do have senority in receiving dividends and during liquidations, dividends are fixed. So, for a going concern, once these shares’ dividends are paid out, all remaining profit goes to the ordinary share holder. Thus, preference share holders’ dividends are capped. Becuase of this, the shares are less risky but also do not benefit from capital gains to the extent of ordinary shares (they’re like bonds).

    Also, if one actually looks at Pravin’s detailed holdings (which couldn’t be seen in the image included) one will see that he owns ~R178 000 worth of absa pref shares. Currently these prefs are yielding pre divident tax of 8,2%. Thus, holding these shares for a year will give Gordhan a return of ~R14 500 – very close to what one would earn in a high interest bearing account. Furthermore, add up all his banking shares, which are all preference shares, and indeed all of his declared assets and the amounts are small – just over four million. As far as porfilio’s go, that’s really not very large. Even a middle manager working in government for a few years would have a pension worth at least that and bonuses for such managers could be close to what he would earn in divident’s,

    So my point is that Gordhan may well be conflicted, but if he can be influenced by what in the financial world are such paltry amounts because then I could go to him with my peasily life savings and take a big bet on the the banks and I’ll be sorted for life.

    1. Dear Gazes Also

      The point you make is one which has been raised many times – how much these shares are worth and whether they matter. I think the writer touches on that somewhere in the article.

      I think the gist of the article and I may be wrong since Im not the author, is that there’s a conflict of interest which you also acknowledge.

      BlackLandFirst has taken the matter to court and we shall here there as this issue is ventilated further.

      Kindest regards


    2. These are participating preference share. Which means over and above the fixed % they have a share in the distribution of ordinary profits as well. hence there is no cap other than their share in the distribution

  9. Well researched article and supported with facts, it’s the most dynamic pyramid scheme of our times…

  10. Crony capitalism succeeds in concentrating wealth at the top of the pyramid. What makes it worse is an apathetic and uneducated public. Maybe we are all just tired of political point scoring. The greedy leading the blind. Business as usual.

    1. Dear JT

      Thank you for joining the UnCensored Community.

      In a democracy, we need to be vigilant, turning stories on all sides to see what is going on. We at UnCensored don’t promise to give the full story – all we will do and are doing is to show you a part of the story that you will never read in the commercial media.

      We should be activists in challenging stories. Once in a while get tired of political point scoring but never let it be the life you lead because in that political point scoring are hidden truths which must be unearthed and exposed.



  11. Dear Les Da-Ama
    Very true naration of facts, keep up the exposure!
    Just to add on the “Bank Shares” held by finance minister:
    Pravin Gordhan’s Bank Preference shares (SBPP) are not ordinary, but very unique, they are called
    “Participating preference shares”
    In addition to a fixed rate of dividend, holders of participating preference shares are also entitled to participate in the distribution of dividends with ordinary shareholders on predetermined time span or on a specific date.
    The fixed-income component offers a steady income stream and some protection of the investors’ capital.

  12. The writer does not seem to know what state-capture is. S/he seems to be asserting that she’s exposing something that was hidden. How could that be, the information is already public knowledge. Everybody who can afford has preference shares because-my grade 10 business studies tell me- they are safe. She’s not aiding the effort to wean the state of the predatory leaches that are looting it.

    1. Dear Zwai Popo

      I say this with the utmost respect but you are not a finance minister who regulates banks and approve government tenders.

      If you already knew the finance minister’s share portfolio and how it relates to the companies which do business with government, good for you. For many, as you will see from the Twitter response and here, we had no idea.

      Im challenging, you as someone who knew this information and I assume you know how to “aid the effort to wean the state of the predatory leaches that are looting” help. This is not the work of only those who are brave enough to spend time chasing the links between government officials, tenders and the winners. I hope I will hear from you



    2. Hey Zwai
      Your grade 10 business studies tell you – they are safe. That might be misleading as there are at least 6 types of Preference Shares, some do have a risk!

    3. your grade 10 misled you. preference shares are called that because they have preference over ordinary shares. This means their dividends are paid before the share holders distribute their profits. how safe they are? they are as safe as the company you invest in. which is why Gordan should not be holding any shares in companies, and be responsible for laws that directly affect those companies. His independence is impaired simple by virtue of that.

    1. Dear Themba

      Thanks for joining the UnCensored Community.

      This is the kind of article we need. The writer has gone into the portfolio and linked it it to government’s service providers. It’s brilliant work.



  13. There is no smoke without fire. To put it modestly, I’m shocked by these revelations. Gordan should stop throwing stones, his house is too glassy!!

  14. This is damning. But I fully agree, there is a very cunning relationship between Manuel/Gordahn & white established capital. The picture that is emerging there should leave many very concerned.

    1. Dear Sfiso

      Thanks for joining our movement of concerned citizens who simply want to see the full picture of corruption.



  15. I feel realy stupid now that i see these kind of shenanigins. Why are these things not brought to the attention of the law enforcement cluster? When someday most of the people see these we will sure as hell have our own “Arab Spring” i cannot believe the writer has not laid charges. Are we not gatvol enough? How long are good people going to be quiet? How long is a piece of string?

    1. Dear Jannie

      THe reason why we live in exciting days these days is that we have groups such as Decolonisation Foundation, BlackLandFirst who can counter the NGOs funded by corporates and George Soros of the world.

      The writer works and needs an income and like most contributors of UnCensored can’t jeopardise his career at the moment. We respect that. What he has done is to put information in the public space which allows you or me or anybody else to lodge a complaint.

      I have no doubt that he would not assist you with other information you required to lodge a complaint.



    2. Jannie.. As we get older we get bolder. Give me time. I’m making strides in that department. The problem is that you can’t open charges based on inferred information based on subjective opinion. However I had hoped to get people thinking about the value of placing trust in politicians, and what democracy and fair and equitable South Africa should look like. It was a think piece of webs and patterns that I perceive and not FACTUAL that that is how decisions are taken by him. It is whether these shares bring consideration when they take decisions or not. What do we as reasonable people think is just and fair.

      IN my mind they work much like the benefit a contractor would get from buying their tiling material from a CTM. The amount is tiny, Its some 2,5%. But come December if you generate enough purchases, you can buy the Mrs. a spa bath, or re-tile that gazebo you’ve been planning to do for ages. It looks insignificant but the benefits are incalculable.

  16. Pls remember this have nothing to do with Race but glaring facts. Pls study the owners of buildings in towns, petrol garages and see that we have nothing. Pre Zuma is trying his best, but if the rest dont help him, its a loosing battle

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