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IOL News
a day ago
- Business
- IOL News
SA markets under pressure as geopolitical tensions escalate and US Fed signals caution
Johannesburg Stock Exchange JSE The rand fell 0.6% to R18.12 against the US dollar during early morning trade but still remained above the R18-mark by late afternoon while the JSE All Share Index eased by 0.2% to 94 785 points. Image: Gianluigi Guercia / AFP South African markets traded on the backfoot on Thursday on the back of geopolitical risks arising from the war in the Middle East and the US Federal Reserve (Fed) revised down its growth forecasts for the US. The rand fell 0.6% to R18.12 against the US dollar during early morning trade but still remained above the R18-mark by late afternoon while the JSE All Share Index eased by 0.2% to 94 785 points. The markets have remained on edge across the world as the war between Israel and Iran has intensified, pushing global oil prices to their highest in four months. An Iranian missile barrage left at least 240 people wounded as they struck several sites across Israel, damaging a hospital in the country's south while targeting a military site. Israel also attacked Iran's Arak heavy water nuclear reactor as the two countries traded fire for a seventh consecutive day. The war in the Middle East saw the Brent crude oil price rising 1.7% above $78 per barrel on Thursday as the main concern for the oil market remains the Strait of Hormuz, a vital route for a fifth of global crude. Oil prices are now trading nearly 9% higher since Israel's initial strikes on Iran, with energy markets increasingly pricing in the chance of deeper supply disruptions. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Adding to tensions, senior US officials are reportedly preparing for a possible strike on Iran in the coming days, signaling Washington's readiness to enter the conflict. However, mixed signals remain, as the White House has given little indication of whether the US would support strikes on Tehran's nuclear facilities. Nigel Green, CEO of deVere Group - an independent financial advisory and asset management firm - said global financial markets were likely to suffer a rapid and sharp selloff if the US launches direct military strikes against Iran. Green said a direct US military intervention could push crude significantly higher, especially if key infrastructure or shipping lanes are affected. 'The world economy is not in a strong position to absorb another energy shock,' Green said. 'If oil spikes from here, inflation expectations will shift, interest rate cut expectations will fade, and that would create a double blow for equities already priced for perfection.' Separately, the US Fed on Wednesday kept interest rates unchanged at 4.25%–4.50% for a fourth consecutive meeting but signaled two possible cuts by year-end. However, the Fed trimmed one cut for both 2026 and 2027, with the bank raising its inflation outlook and lowering its growth forecast. It comes as policymakers take a cautious stance to fully evaluate the economic impact of US President Donald Trump's policies, particularly those related to tariffs, immigration, and taxation. The Fed noted that the increases in tariffs this year are likely to push up prices and weigh on economic activity, adding that the effects on inflation could be short-lived—reflecting a one-time shift in the price level— and could instead be more persistent. It said the effects of tariffs will depend, among other things, on their ultimate level. Expectations of that level, and thus of the related economic effects, reached a peak in April and have since declined.
The Citizen
11-06-2025
- Business
- The Citizen
Where are the student rooms and returns investors were promised?
Founder of ISAF Ithubalethu tries to explain why the scheme faltered, while saying there's still potential. No money, no accommodation. SA investors are still waiting for their 'mouthwatering dividends'. Picture: azi/Adobe Stock A Moneyweb subscriber has raised an interesting question: What happened to the Inkunzi Student Accommodation Fund (ISAF)) Ithubalethu investment opportunity that was promoted some five years ago? 'In 2019, I and other South African individuals invested in a company ISAF Ithubalethu promoted by Owen Nkomo during their initial public offering. It was broadcast [on] talk radio stations and other forms of media. 'We were promised mouthwatering returns or dividends after 5 years of a lock up period, something which has not materialized to this day. I can provide documentation to this claim,' the subscriber writes. 'Owen Nkomo keeps changing addresses without informing us as investors. The company is not operational with no address. He refuses to give us financial reports. We have never held an annual meeting ever,' the reader claims. 'He lied about some of the information in the prospectus, like claiming Computershare will do the administration of the IPO. When I called Computershare to verify what was written in the prospectus, they denied ever working with him or ISAF Ithubalethu.' The disgruntled investor adds that he checked and can confirm that ISAF Ithubalethu is not registered with the Financial Sector Conduct Authority (FSCA). However, registering as a financial services provider is not necessary when a company raises equity capital. ALSO READ: Big boost for student living quarters Big plans Nkomo, founder and CEO of ISAF Ithubalethu, had a good idea back in 2019. And he had big plans. He aimed to raise R1.4 billion to list a property company on the Johannesburg Stock Exchange. He planned to build – or buy and renovate – buildings near universities to rent the rooms to students. It was a good plan and would have generated good returns for investors, as any parents paying eye-watering rent for a small apartment for their studying children can attest to. Unfortunately, large institutional investors were not convinced and none committed to big money. Undeterred, Nkomo adjusted his aim and decided to start with a smaller amount. He targeted individual investors in a bid to raise R250 million. ALSO READ: Nsfas payment delay puts student accommodation at risk Investor roadshow Nkomo printed a prospectus and travelled SA to solicit funds from people. The prospectus stated that ISAF Ithubalethu had been set up to give 'the man in the street' an opportunity to participate in a formal capital raise, where the proceeds will be deployed in investments linked directly, or indirectly, to purpose-built student accommodation facilities. 'A Johannesburg Stock Exchange listing will be considered once the portfolio has reached a reasonable scale, and more capital is required to expand the asset base of the business. Prior to that, a listing on a smaller exchange could be done to provide liquidity to investors seeking to buy in or trade out of the investment. 'The initial investment will be locked in for five years, to allow management to grow the fund, create a track record and deliver consistent returns to initial investors,' the prospectus said. 'Having experienced the challenges of raising capital to buy targeted assets, and entering into exclusivity arrangements with owners of student assets during the process of listing ISAF, management of ISAF Ithubalethu decided to use the unlisted special purpose acquisition company route,' it added. 'This means that despite having a pipeline of potential assets worth over R1.8 billion to buy, ISAF Ithubalethu will raise cash first, and only after the capital raise will transaction legalities be entered into. This will strengthen the buying power position of the entity since a 'balance sheet' will already be in place. 'It is this 'journey to the balance sheet' that the founders and promoters of ISAF Ithubalethu are inviting the public to join in,' Nkomo said at the time. The minimum investment was set at R5 000 with the promise that income returns would be between 8.5% and 10% per annum. ALSO READ: Student res up for grabs in Bertrams Gearing Old Facebook posts still showcase Nkomo's investment proposal. These promise larger returns, in that an investor's investment will be bulked up with debt to enhance returns. The company proposed leveraging an investment of R10 000 with a loan of another R20 000 for total capital of R30 000, which could earn a net return of 10% per annum. It shows a dividend of R3 000 per annum – a return of 30% on the original investment. The promise was: 'After all debt paid off, target dividends due to you (dividends will be paid every year).' Facebook posts inviting the public to presentations, circa 2019 Source: ISAF Itubalethu Facebook page The prospectus stated that the opportunity was huge. 'With SA clearly miles behind the developed world, it is believed that the addressable market value of the opportunity is between R75 billion and R125 billion and growing at 5% per annum,' it said to entice investors. The reality turned out to be different. Nkomo conceded to Moneyweb that there have been difficulties and that the company was not able to raise enough money to invest in big buildings. He did not answer the question about how much ISAF Ithubalethu actually managed to raise. 'I got your email. I've been back in there with retail investors not understanding how things work. And most of the issues they're raising, they've been raised and handled by our call centre. I'm not the one that's supposed to deal with them, but I do take their calls now and again. 'But we have a full-time call centre and we're actually releasing communication by end of this week to all the shareholders,' said Nkomo. 'The one thing that I'm battling with is getting them to understand that there has to be processes that are followed so that we get to a point where we say we're paying the dividend. 'Results are being prepared right now,' he claimed. 'We're going to announce the results and the dividend payment soon. We're testing systems for them to be able to do transactions between each other if they want to exit the scheme.' ALSO READ: Where are the 'ghost students'? Concerns over housing changes Smaller than envisaged Nkomo admits that the project is much smaller than promised. 'It became a very small scheme. We were looking for R1.4 billion. We could not list because in 2018, because the property sector crashed. 'So it became a very small scheme, which I was preparing for the BEE (Black Economic Empowerment) participants to buy into the entity we were going to list. So in that, we raised, I think, about R5.5 million because the minimum on that ticket was R5 million. 'So it's a small ticket, and we are going to be paying dividends out. And we have actually started doing the test runs on that,' he said. The company did not buy rental properties. 'Because of the amount of cash that we raised, we decided to not buy properties, but invest in some of the ancillary stuff that happens in the real estate space. For example, financing small refurbishments and things like that. And doing normal residential stuff,' according to Nkomo. He said investors don't understand the investments they made. 'They think that they can just liquidate their investment, but you can't because it's a share.' ALSO READ: 'No evictions of any student', says Manamela on Nsfas accommodation He elaborated on this: 'The peculiar thing about a share is that it's not a listed share. It's a public share, but it's not listed. And it was a SPAC [special-purpose acquisition company] as well. We are going to be giving them 10.2% as a dividend, but I've got processes that I've got to go through. 'People pass away, they lose their phone numbers, you don't get the certificates or the latest FICA. You know how the authorities are trending down on transactions that are not FICA compliant,' he added. 'I am getting that in place. I need to get that to 70% compliance in terms of getting everybody's latest document coming in and then taking the processes forward. It's just a matter of continuing to educate the guys and communicating in a language they can understand. I need to do a test run of dividend payments. You need to test out these things be[fore] we do the full payment,' said Nkomo. He noted that this will be the first dividend. 'Remember, we had a lock-in for five years. So we can't have been paying dividends in that period. And then there was the two years that we lost to Covid, right? So we effectively worked for only three years,' he added, confirming that ISF Ithubalethu is operating and making a profit. He promised to supply more information by email, which will be added to this article once received. This article was republished from Moneyweb. Read the original here.
Bloomberg
05-06-2025
- Business
- Bloomberg
South African Assets Rally Despite Global Headwinds
South African assets are on the march despite uncertainty in global markets over the outcome of tariff negotiations. The Johannesburg stock index is nearing a record 100,000 level mark, benchmark bond yields are hovering near a three-year low, and the rand is at its strongest levels in six months.
The Citizen
04-06-2025
- Business
- The Citizen
Cosatu says debate on B-BBEE is needed for beneciaries' benefit
Cosatu calls for reform of B-BBEE to ensure real empowerment for workers and disadvantaged communities, not just political elites and business insiders. The debate about the broad-based black economic empowerment (B-BBEE) is needed on how to ensure it benefits the beneficiaries. This is according to union federation Cosatu spokesperson Matthew Parks, who was reacting to the ongoing debate on whether the B-BBEE policy is aimed at being biased against whites. Inequality persists 'While we support the B-BBEE Act, we believe a debate is needed on how to make sure it reaches its intended beneficiaries, in particular historically disadvantaged individuals and communities,' he said. 'We support the objectives of B-BBEE. These are necessary given three and a half centuries of systematic discrimination and disempowerment under colonial and apartheid rule. South Africa is 31 years into democracy but remains the world's most unequal society.' Parks said the policy was a necessity to help historically disadvantaged persons and communities to enter the economy, not only as wage earners but also as owners of businesses. He said Cosatu cannot remain satisfied with progress when the colour of one's skin still largely determines one's economic status. ALSO READ: Minister extends date for comments on R100 billion transformation fund 'Ticking time bomb' He added the majority of shares on the Johannesburg Stock Exchange are owned by whites, similarly with regards to ownership patterns of businesses. 'This is a ticking time bomb that we must address. It's not racism against whites and, in fact, white women and white South Africans with disabilities are included. White South Africans and investors are not excluded,' he said. 'All the policy seeks to do is to boost the economic empowerment of those still disadvantaged. It has helped to begin the journey of building a nonracial society. While some progress has been made in building a black middle class and black industrialists, it is not enough given the inequalities still so prevalent.' Parks said more must be done to ensure 'it benefits workers and not just the elite and worker ownership and employee shareholder ownership programmes should be ramped up'. He added more must be done to ensure investors honour their B-BBEE shareholders and equity equivalents. Equity equivalents offer alternative for foreign investors When asked if Cosatu supports the equity equivalents, Parks agreed and said that has been one of two options under the B-BBEE Act for many years. He said they provide a useful option for international investors who are not able to do the B-BBEE shareholders' option. ALSO READ: DA transformation policies stance dents its image and may lose it votes, says expert 'Equity equivalent option allows investors to support local manufacturers, create jobs, skill workers or invest in local communities,' he said. 'These have benefited many local businesses, workers and communities. They have been successful in many sectors, including clothing and motor manufacturing. Many companies have utilised this option before.' Malatsi's draft policy Communications and Digital Technologies Minister Solly Malatsi was recently criticised for unveiling a draft policy direction in the Government Gazette 'proposing an alternative to the B-BBEE ownership requirements for the ICT [Information and Communication Technology] sector'. 'The new model would allow companies to meet empowerment obligations through equity equivalent programmes rather than direct ownership transfers,' one critic said. The proposed amendment to the Act could facilitate the entry of investors such as Elon Musk's Starlink into South Africa's telecommunications market and contribute to the empowerment of the previously disadvantaged people without having done a direct transfer of ownership. Malatsi's critics said he was trying to pave a way for Starlink to do business in SA. Musk has previously criticised the B-BBEE policy, saying it was racist. NOW READ: Proposed Starlink deal 'wrong in principle and practice'
Yahoo
03-06-2025
- Business
- Yahoo
Anglo American completes demerger of majority stake in Valterra Platinum
Anglo American has announced the successful completion of the demerger of approximately 51% of its interest in platinum group metals (PGM) business Valterra Platinum and the associated share consolidation. This strategic move follows the approval by shareholders on 30 April 2025, with the demerger taking effect on 31 May and the share consolidation becoming effective on 1 June. Post-demerger, Anglo American will retain approximately 19.9% of Valterra Platinum and intends to hold this shareholding for at least 90 days following the demerger, with responsible management of this position over time to achieve a full separation. Anglo American chief executive Duncan Wanblad said: 'This is an important moment for both Anglo American and Valterra Platinum. For Anglo American, this is a major step in our plan to unlock the inherent value in our portfolio as a whole, with enhanced focus on our world-class positions in copper, premium iron ore and crop nutrients. 'Valterra Platinum has been a major part of the company for many years, but now is the right time for it to optimise its value creation prospects on an independent path – it is an outstanding business and team and I have every confidence that Valterra Platinum will thrive as a leader in the global platinum group metals industry.' Valterra Platinum marked its entry on the Johannesburg Stock Exchange as an independent entity on 28 May, finalising its spin-off from Anglo American. The demerger of the Johannesburg, South Africa-based PGM producer, formerly known as Anglo American Platinum, is in line with Anglo's strategy to focus on the copper and iron ore sectors. Currently, Anglo American is making several major structural changes to rapidly deliver its strategic priorities of growth, operational excellence and portfolio simplification. "Anglo American completes demerger of majority stake in Valterra Platinum" was originally created and published by Mining Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
