Beacon of BEE close to ruin amid infighting
Squabbles, allegations of maladministration threaten Pamodzi Group
It was billed as one of the country’s foremost black economic empowerment (BEE) groups. But today, Pamodzi Group is rocked by serious allegations of misgovernance and misappropriation of funds, and the founders are at each other’s throats.
Renowned businessman Ndaba Ntsele has found himself at the centre of a storm that threatens to tear apart an iconic empowerment group he cofounded 43 years ago.
In 1979, Ntsele, Solly Sithole and the late Ncedi Manyoni established a company that was then operating mainly in the construction sector.
The group has been part of some landmark BEE deals in the country in the 90s and early 2000s. These include the 1998 purchase of a controlling stake in Foodcorp for over R1.8-billion. Foodcorp’s turnover at the time was about R3-billion a year and its brand names included Glenryck, Enterprise and Nola.
However, today the group is but a
Pamodzi has been using municipal funds to pay salaries, operational expenses and trips for Noluthando
shadow of its former self, with many of its entities “technically insolvent”.
Insiders place the blame on internal squabbling and alleged mismanagement of the company’s finances by Ntsele and his clique.
An insider pointed to the group’s subsidiary, Pamodzi Revenue and Energy Solutions (PRES), as one of the entities where mismanagement has brought the company to its knees. PRES is a leading supplier of electricity and water smart meters and has won several meter vending contracts from municipalities.
However, Sunday World has seen a memo prepared by the company’s former CFO, Tendo Ramadzanga, and sent to the board detailing a litany of allegations against Pamodzi and Ntsele, including that funds meant for municipalities were diverted to fund its operations.
“Pamodzi has been using the municipal funds to pay salaries, operational expenses, trips for Noluthando [his daughter] and the bogus bonuses she gets, and to fund his lifestyle to go to Zimbali
or even Dubai. However, he wants to pin it on me because I was a whistleblower against him. The best thing is that I have evidence of all of these items,” he said in the letter.
PRES is headed by Noluthando Ntsele.
Sunday World has seen a letter dated October 28 from Dikgatlong municipality, cancelling the services of PRES after a month. The municipality cited the following as reasons for terminating the contract:
• Vending machines are constantly off;
• Indigents not receiving their free basic electricity; and
• Income from prepaid electricity vending has not been deposited into the municipal bank account as per the service level agreement. In December last year, Ramotshere Moiloa local municipality also terminated its contract with PRES. A former executive at the company said it was not surprising that municipalities were ditching PRES and that nepotism had taken over. “We had a situation where a lawyer was heading PRES and we want to be surprised when (new contracts) don’t kick off when, on the other hand, you hound out key people who oiled the machine,” he said.
Ntsele had not responded to Sunday World’s questions by the time of going to print despite promising to do so.