Voices

Book Extract: ‘I sold my company to the ANC’

2019-10-22 01:11

Taking centre stage at the Zondo commission, the wheelings and dealings of late Bosasa CEO Gavin Watson gripped the nation.

In this extract from Adriaan Basson’s new book, Fanie van Zijl recalls how his business landed in the hands of Watson

Blessed by Bosasa: Inside Gavin Watson’s State Capture Cult by Adriaan Basson

Jonathan Ball Publishers

276 pages

R260

Fanie van Zijl was arguably South Africa’s top (white) athlete in the 1970s.

A Springbok middle-distance runner, he was “almost unbeatable” and an “amazing strategist” in the 1 000m and 1 500m races.

He was also a prolific entrepreneur and started several manufacturing and services businesses in Krugersdorp on the West Rand in the 1970s under the umbrella name Meritum.

Van Zijl and his business partner, Jurgen Smith, saw potential in buying up old mining hostels on the West Rand in Johannesburg and running them as private lodges, renting out rooms to miners, employees of Telkom and other blue-collar workers.

Meritum took over the catering and cleaning of these hostels in the 1980s. The company also took over the catering at mines in Krugersdorp, Randfontein and Carletonville.

Van Zijl contracted a friend, Paulus Vorster, better known as Oom Vossie, who owned a dry-cleaning business in Randfontein, to do the laundry at the hostels.

Vorster’s son, Frans, who joined Bosasa as head of security (and would become Gavin Watson’s go-to man when politicians, government officials or the Watson brothers needed cars or car repairs), recalled: “At the time I worked as a policeman in Krugersdorp and later as station commander at Tarlton police station. We [Meritum] saw a business opportunity – a space to hold foreigners who were arrested.”

The West Rand, with its proximity to the gold mines, saw a lot of undocumented foreign nationals being arrested by the police.

“A number of police stations simply didn’t have enough space in their holding cells to keep foreigners and feed them. So we started to negotiate with home affairs.”

Van Zijl had another idea – to establish youth centres for awaiting-trial juveniles, who at the time were kept with adults in the same prison.

Driven by a personal belief that children shouldn’t be kept with “hardened criminals”, Van Zijl converted some of his empty hostels into youth-friendly prisons.

Van Zijl was passionate about his project to remove children from adult prisons “where they could be sodomised”.

Negotiations took place with the police and the department of correctional services, which had a major overcrowding problem in the early 1990s.

A senior prison official called Patrick Gillingham represented the department.

“Patrick and my father were good friends; at that stage he [Gillingham] wasn’t corrupt,” said Frans Vorster.

As a result, Meritum youth hostel was launched in 1995 as a project with the department of social development; and a year later Lindela opened its doors as the country’s first repatriation centre where undocumented migrants awaited determination of their legal status in the country.

In 1996 everything changed. Although black economic empowerment wasn’t yet an official policy of the ANC government, there was pressure on companies doing business with government to include black shareholders in their companies and in doing so change the face of business in South Africa.

Van Zijl and Smith knew they had to change the ownership structure of the company. Enter the Watsons and a group of ANC Women’s League (ANCWL) leaders.

At the centre of the initial introduction was the Small Business Development Corporation (SBDC), which was started in 1981 by Anton Rupert and his son Johann, as a public-private partnership to support small, medium and micro businesses.

At the time Smith, a co-owner of Meritum, was a senior member of the SBDC, and Eastern Cape businessman Danny Mansell headed up the provincial branch of the corporation.

Gavin Watson was looking for new business opportunities after the family’s clothing business had folded, and ended up knocking on the door of the SBDC.

We concluded the deal. We had a contract. I gave them a big discount. I figured this was my contribution to the ANC.

Mansell helped Watson to assist emerging black businesses in Port Elizabeth. But something went wrong, and Mansell was paid out by the corporation to leave – details about Mansell’s sudden departure from the SBDC are sketchy and those who know are either dead or refuse to talk.

Having met Smith during his time at the SBDC, Mansell, Watson and Port Elizabeth accountant Tony Perry put together a bid to buy Meritum.

Van Zijl recalls how the three men drove from Port Elizabeth to Johannesburg to discuss the purchase.

“Watson was representing the ANCWL. He said: ‘Let’s go to Johannesburg to see the ANC Women’s League.’ When we got there, it was only Nomvula Mokonyane at the meeting. I didn’t know her.”

At the time, Mokonyane was the Gauteng MEC for agriculture, conservation and environment.

“We concluded the deal. We had a contract. I gave them a big discount. I figured this was my contribution to the ANC.”

Bosasa was never an ANC front company. Gavin may have wanted it to seem that way, but the ANC never endorsed Bosasa.
Angelo Agrizzi

But Meritum was never sold to the ANC.

The deal was done with Dyambu Operations (which later became Bosasa Operations), a facilities management company of which Watson and Mansell owned 90% of the shares in equal parts.

The other 10% was owned by a group of ANCWL leaders through their company Dyambu Holdings.

“Bosasa was never an ANC front company. Gavin may have wanted it to seem that way, but the ANC never endorsed Bosasa,” said Angelo Agrizzi, who lifted the lid on Bosasa’s continuous support of the ANC through donations of money, resources, facilities, food parcels and even birthday cakes.

Agrizzi recalled that Van Zijl and Smith sold Meritum to Watson and co for “about R6 million or R7 million”.

Mansell used his payout from the SBDC to buy the shares in Dyambu Operations.

Watson left his family in Port Elizabeth and moved to Johannesburg to be close to the action.

Mansell ran Dyambu, and Watson was responsible for marketing. Watson also had a consultancy job with Sun International to help them win casino licences.

“Gavin arrived without a house or a car. He drove plenty of Sun International cars, but he didn’t have his own,” Frans Vorster remembered.

Agrizzi recalled that Watson essentially “lived out of his boot”.

Smith stayed on at Dyambu (and then Bosasa) until his death in 2016, but Van Zijl left much earlier.

“Fanie and Doc Smith fought,” Agrizzi explained.

READ: The Bosasa billions: Smoke, mirrors and Agrizzi

“He [Van Zijl] didn’t know Lindela [the repatriation centre] was part of the transaction. He [had] wanted to retain the properties. For years, Smith and Van Zijl never spoke to each other.

“Van Zijl was still trying to run the business after Watson arrived [as an employee], but Watson would have none of it. There was a major breakdown, there was snot en trane [heavy crying].

“Watson told Van Zijl to go home and retire and rest.”

It was evident to me that Van Zijl was sad and upset about what had become of the company after he left in the late 1990s.

Talking about the allegations of corruption, bribery and state capture levelled against Watson and his peers, he said: “Why must you do business like this? How much money do you want to make? There are plenty of ways to do honest business.”

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November 17 2019