The announcement this week that Mvelaphanda Group would be unbundled has raised the need to remind those who have followed the firm in the past few years of its origins.
In 2003 the directorates of Mvelaphanda Holdings and Rebserve Holdings came up with the idea of creating South Africa's leading black economic empowerment (BEE) group.
The group said this would be done by merging the firms and assets of Mvelaphanda Holdings and Rebserve. A year later the merger established Mvelaphanda Group. Mvelaphanda Holdings, the parent firm of Mvelaphanda Group, owned 51 percent of the shares in Mvelaphanda Group.
Mvelaphanda Holdings was founded in 1998 by Tokyo Sexwale as a private firm. It has a diverse shareholder base that is more than 90 percent black, including South Africans who had never before held shares.
Mvelaphanda Group combined the stature and entrepreneurial reputation of the Mvelaphanda Holdings brand and team and the prospect of substantial BEE deal flow. It was going to tap into the transactional skills of the former Rebserve and its management.
This was a win-win merger, the group said, which enabled the cash from the group's services operations to be used in financing and securing financing for the major BEE deals that Mvelaphanda Group planned to seal in the transformation of the South African economy.
The firm used its BEE credentials and the platform established through the combination of investments with cash-generative operations. Mvelaphanda Group would continue to participate in the transformation of the economy by pursuing and implementing value-enhancing BEE deals.
Mvelaphanda Group has investments in firms in the financial services, consumer services, construction and infrastructure, telecoms, media and technology sectors.
It had good growth prospects in the medium term as a result of a strong market position, good management and sound industry fundamentals. Investment activities focused on the management of investments and the provision of support, leadership and guidance where necessary to these firms.
It avoided the day-to-day operations of these firms. Mvelaphanda Group owns 44.7 percent of Batho Bonke, which owns preference shares and options equal to 10 percent of Absa. It holds 12.3 percent of Vox Telecom's share capital. In 2007, Mvelaphanda Group bought 25.5 percent of media firm Avusa.
It also has a 10.7 percent interest in Group Five.