The odd couple
THE COMBINATION OF Mark WellesleyWood and Mzi Khumalo looks interesting to say the least. Throw in Zimbabwe and you’ve got a broth of heady redolence. That’s the proposition London investors will face if plans to finally list Metallon Gold – Khumalo chairs Metallon Corporation – get off the ground.
Former DRDGOLD CEO Wellesley- Wood is considering an offer to run Metallon Gold, which owns 150 000 oz/year of gold production in Zimbabwe and is currently a subsidiary of the privately held Metallon Corporation.
Speaking from London, where he’s mulling over Khumalo’s offer, Wellesley-Wood said he was quite set on a quiet life of red wine and books.
“I was happily building my own house in Cape Town. But then we broke bread and had a few whiskies.”
The thought of Wellesley-Wood padding around the house in slippers doesn’t quite work. The combination was being worked on a while back. The two were most recently spotted in Sandton Square at a well-known restaurant. But the deal was shaped well
Both Wellesley-Wood and Khumalo were in Cape Town in February attending the Mining Indaba conference. While there, Wellesley-Wood cut a lonely figure without his beloved DRDGOLD, from which he was finally ejected in December. Clearly, he couldn’t wait to get back into the fray.
Khumalo turned down an interview, as is usual. Buffeted by media, he’s suspicious of public announcements. By contrast, Wellesley-Wood feels bulletproof. Together, you can see they make a good team.
In Wellesley-Wood, Khumalo has the perfect mouthpiece for what would be a hellishly difficult sell. Zimbabwe is on its knees and, by all accounts, the Metallon Gold assets have been slumming it.
Former Metallon Gold CEO Greg Hunter declined to comment on the proposed listing, one he was repeatedly frustrated in achieving. He’s got his own (listed) company now, Central African Gold (CAG), which has bought mines in Zimbabwe. Commenting on the country, Hunter says: “The last couple of weeks the currency has weakened terribly. People are nervous.”
But Hunter knows the potential payoff is massive of first-mover advantage should Zimbabwe eventually fall on its feet.
Banro Corporation, a Toronto-listed firm, bought gold-bearing property in the Congo well before its democratic elections and finds itself unshackled by any of the tenure squabbles currently under way in that country.
Will Metallon Gold and CAG fare the same in Zimbabwe? “There’s the possibility of first-mover advantage and it’s all about risk and reward,” says Mark Smith, an analyst at RBC Capital Markets. “But will those companies be able to retain security of tenure if and when Zimbabwe restructures itself?”
It’s also worth noting how investors currently treat investments held by Impala Plati-
num and Aquarius Platinum in Zimbabwe. “They don’t get any recognition for it,” says Smith.
Feeling bulletproof. Mark Wellesley-