Star 2024-08-20

President Cyril Ramaphosa has hailed the growing confidence among investors about the prospects for South Africa’s economy on the implementation of structural reforms, as the stocks and currency markets continued yesterday to new record highs. The JSE All-Share Index rose more than 1% to above 83 600 index points, setting a new record high and marking its fifth consecutive day of gains, largely buoyed by retail-linked stocks, resources, financials, and telecommunications. The growing optimism around interest rate cuts by the US Federal Reserve continued to support market sentiment yesterday, as investors awaited the release of Federal Open Market Committee (FOMC) minutes and the Jackson Hole symposium of central bankers where Fed chairperson Jerome Powell is set to give a speech on Friday. Meanwhile, the rand also remained at more than…

Business rescue practitioners (BRPs) of the beleaguered automotive parts retailer, AutoZone, have confirmed being in productive negotiations with potential buyers of the franchise, which has necessitated the postponement of the rescue plan for the second time to early September. Matuson & Associates BRPs said yesterday the latest postponement of publication of the business rescue plan was to allow identified potential investors to conduct due diligence on the enterprise, which is about R300-million in the red with Absa. Lance Schapiro, a partner at Matuson & Associates, said: “The publication of the business rescue plan has been extended to September 2 to allow for due diligence by potential investors.” This is as the legal department of the Motor Industry Staff Association (Misa) confirmed it was monitoring developments around ongoing negotiations. “AutoZone has…

ABSA Group CEO Arrie Rautenbach is stepping down after only two-and-a-half years as the lender reports a 5% slide in first half headline earnings to R10.2 billion, despite profit growth in the South African operations and prospects of a better second half overall. In a surprise announcement with the interim results yesterday, South Africa’s fourth-largest lender said Rautenbach had agreed to take early retirement. This appeared to be favourably received by the market, as the share price had advanced by 4.99% to R165.27 by late yesterday afternoon, which is a sharp increase for one of South Africa’s big banks. Rautenbach would be CEO until October 15, and would serve out his six-months contractual notice period as “garden leave”. Tasneem Samodien, research analyst at Old Mutual Wealth Private Clients, said the…

Shares in Thungela Resources, which will kick-start a share buyback scheme for the second half of 2024, fell 1.7% in afternoon trade on the JSE yesterday after it reported declining interim dividends and earnings for the six months ended June 30 2024. The company advised, though, that it had noted progress in efforts to improve Transnet Freight Rail’s capacity. It traded firmer at around R128 per share in the early trading session, extending its 9.65% surge on the local bourse in the past 30 days before tipping into negative territory in the afternoon. In the half-year to June, Thungela repurchased 3.3 million ordinary shares for R441 million, and yesterday the company said it had set its focus on the second instalment of its share buyback scheme. Thungela said it would…

Electricity Minister Dr Kgosientsho Ramokgopa’s decision to withdraw the 2 500MW new nuclear procurement from the government gazette should be welcomed, even by those who support a new nuclear power station. His concession shows that finally the former Department of Mineral Resources and Energy (DMRE) – which has been split into the new Department of Electricity and Energy; and the Department of Mineral Ressources – is learning the lessons as to why the 2016 alleged “Russian nuclear deal” failed. The court judgment at the time made no ruling on the R1 trillion number that we still hear about, rather the judge ruled that the public participation process wasn’t adequately followed. In fact, all that the government had to do, if they were serious about new nuclear power, was…

The Companies Amendment Act extends the time bar to hold directors accountable from 24 to 60 months, or even more with good cause. It’s a move in the right direction, but I question whether it is enough. The amendment is a direct result of the Zondo Commission of Inquiry into State Capture’s finding that directors of captured state-owned entities had not been properly held accountable. It called for an amendment of the Companies Act to extend the period in which an application for an order declaring a person delinquent can be brought “as it can take a number of years for the facts of delinquency to be uncovered”. The Companies Amendment Act amends the Companies Act of 2008 to extend the 24-month time bar to launch proceedings to 60 months…