By Marcia Klein

It’s business, the group says, shrugging off its ANC connections. Marcia Klein reports
Kinesh Pather is hoping to move from his union-investment roots to build a new business empire.

Pather, the managing director of Bataung, has been involved in empowerment in energy for years through the chemical workers union investment company. Now he and his fellow African National Congress- linked Bataung shareholders are moving into the property sector.

But, he first hit the spotlight recently when the company announced its intention to buy the Sunday Times holding company through Koni Media Holdings.

Bataung belongs to President Thabo Mbeki’s adviser Titus Mafolo, foreign affairs spokesman Ronnie Mamoepa, the former chief of state protocol Billy Modise, businessman Groovin Nchabeleng and Pather, a former doctor and a black economic empowerment player in the energy sector.

This week, Bataung announced its intention to become an industrial group with plans for major investments in gas and property.

The company and its partners, NT Energy Africa and the Central Energy Fund (CEF), have committed R100-million towards exploration for coal-bed methane reserves. According to Bataung, the project represents a potential investment of 10- billion over the next seven to 10 years in infrastructure rollout.

Pather said NT Energy Africa was a technical partner and an investor. NT and Bataung jointly secured exploration licences and approached the CEF.

“We presented the plan and the CEF wanted to take part. We are giving it 40% for no consideration.”

South Africa is a net importer of gas, and Bataung believes it can make a significant difference by providing alternative sources of energy.

NT Energy Africa managing director Chris Mumby said coal bed methane was a cleaner burning fossil fuel which could be used in power generation, diesel production and petrochemical industries. Funding for exploration had been raised in the UK and Europe.

According to Mumby, Eskom had indicated that it could convert certain power stations to accept gas feeds of up to 30%.

Drilling has begun in three locations and by the middle of next year, the company would know the gas content and recoverable gas at two of those fields.

Pather said the group intended to build a gas company. “We see gas as the next power source globally.”

Koni, the media arm of Bataung, has been described as a government front following its controversial R7-billion bid for Johncom, now Avusa. The bid was interpreted as a government move to buy what is widely regarded as South Africa’s most influential newspaper.

Pather said Bataung has “a whole strategy in media” not restricted to an interest in taking over Avusa. The strategy includes “a number of media platforms”.

Nchabeleng said on Friday an announcement would be made regarding Avusa in the new year, and would not comment further.

Pather defended Bataung’s political links, saying its owners are “a group of individuals who came together with a common understanding to play a significant role in the transformation of the economy”.

They supported the ANC, he said, and their views and Bataung’s strategy were linked to the ANC and the government’s views about SA’s future, but they were not influenced by them.

Asked if its reputation as a government pawn and the presence of high-profile officials worried him, he said: “It is important that they declare an interest. But we are not going for tenders, and we don’t want to be where there is a conflict (of interest).

We are in business. We don’t get them involved in what is going on in the business.” He said Bataung was run by himself and Nchabeleng, with the others involved as “shareholders only”.

Its aim was to participate in key sectors in the economy, and media, energy and property had been identified.

“Groovin is in the media sector and understands it well,” Pather said.

Nchabeleng is group chief executive of advertising agency Leo Burnett, where he started his career as an intern.

He left Leo Burnett in 1999 to start Blueprint Strategic Marketing Communications with Modise. He and Modise founded Koni Media Holdings last year, and bought a majority stake in Lobedu Communications Group, the holding company for the Leo Burnett group.

Pather said he had “been in the empowerment space for the past 10 years”. He has an MBA in finance and has been involved in trade union investment.

He was involved in discussions for the petroleum charter and the Total empowerment deal. He has subsequently become a Total shareholder in his personal capacity.

Pather said he had also been involved in a number of other empowerment deals, including those of pharmaceutical company Aspen and platinum miner, Implats.

A deal regarding Bataung’s property interests would be announced in the new year. Pather said Bataung would focus on commercial property and large developments.

Importantly, Bataung’s strategy is to own and run companies. “We don’t want to be passive shareholders, we want to have control.”

Passive shareholding would, however, be considered and would be housed in Bataung Strategic Investments.

“We are a company that wants to build and create something and be part of the transformation of the economy. We want to own and run businesses and not be minor shareholders. We do not want to be 10 percenters. ”

Pather said a listing on the JSE would be “premature” for Bataung. “There are various other deals in the pipeline and when the time is appropriate, we will look at it.”