JOHANNESBURG (miningweekly.com) – Indian mining billionaire Anil Agarwal is encouraging Anglo American – in which he now holds more than 21% – to accentuate its link with South Africa, where the Vedanta Resources company he founded and chairs is successfully turning to highly positive account the zinc assets that Anglo walked away from eight years ago.
Anglo’s South Africa connection receives high praise from Agarwal, who is pleased with the decision of the London-listed, South Africa-rooted company to retain South African assets previously earmarked for potential disposal.
“I’m not saying this for sentimental reasons, but I’m saying this for business reasons,” Agarwal affirmed to Mining Weekly Online in an interview in Johannesburg.
Agarwal’s trust company Volcan Investments – through which he owns the Anglo shareholding and through which he also controls Vedanta – has witnessed the value of its shareholding in Anglo soar by 50%.
He expressed the firm belief that Anglo’s South African connection is of significant benefit to shareholders and recalled that when investors were being advised to disinvest from South Africa, he invested in the country “and I’ve been proved right”.
“Every company in the world originates from one country or another and the home of Anglo American is South Africa. Definitely, I would like more South African directors on the board. Also, you will see South Africa and Africa become even prouder of Anglo American, trust me,” he added.
Founded in South Africa 101 years ago, Anglo switched its primary listing from Johannesburg to London 19 years ago and disposed of its zinc assets to Vedanta in 2010.
Through decisive underground and near-pit mining, Vedanta quickly achieved payback on Anglo’s former zinc assets in a mere two years, and is now implementing a far-reaching beneficiation plan for South Africa’s needy Northern Cape, where its new $400-million Gamsberg zinc mine is scheduled to reach full production later this year.
Moreover, the Vedanta board has approved the go-ahead for a feasibility study into the development of a $700-million, 250 000 t/y, first-phase smelter-refinery complex, with second and third phases matching the Gamsberg mine’s own phased expansion plans.
The feasibility study’s scope takes in a review of previous work on clustering Vedanta Zinc International’s Black Mountain Mine and Skorpion Zinc in neighbouring Namibia. On the cards is the conversion of the 150 000 t/y Scorpion operation to co-treat sulphide and oxide concentrate from Gamsberg.
“I’m looking at 20, 30 or 40 downstream industries coming here,” Agarwal told Mining Weekly Online in outlining his vision for zinc-related galvanising activity and sulphuric acid spinoff. “They’ll use our zinc metal to galvanise pipe, sheet, anything and everything, and when you make zinc, sulphuric acid comes out and sulphuric acid is a fundamental ingredient of many industries,” he said of envisaged fertiliser production.
Needed to support all these will be additional power, transport and water infrastructure, with solar power earmarked to play a role in an integrated power solution.
MANDELA AND GANDHI
Agarwal told Mining Weekly Online that his interest in investing in South Africa intensified during the 2016 official visit of Indian Prime Minister Narendra Modi, a great admirer of Mahatma Gandhi, who with South African icon Nelson Mandela, have inspired his R21-billion investment in Southern Africa to date, which includes a R100-million in community relations.
Agarwal, 64, described himself as a product of his mother – “she always believed in me" – and recalled how his mother had showered love on her four children, despite the very meagre means at her disposal. His great maternal fondness is reflected in her name, Ved, providing the first three letters to the name Vedanta, a company that today employs 100 000 people, has assets worth $40-billion and is engaged in the mining and marketing of zinc, lead, silver, copper, iron-ore, aluminium and oil and gas, as well as the generation of electricity.
Agarwal’s business ambition took him from his Indian home town of Patna to Bombay, where he founded a scrap metal business that became the forerunner to Vedanta, which he sees as “an institution that puts most of its wealth back into society”. This is to fulfill his dream of no child under the age of seven going to bed without food, or being denied access to education and health services. He also dreams of the day when the women of India and Africa will have greater financial independence and when every exploited woman is taken care of.
He decries women being forced to get married too young and often having to look after many children on a pittance. To help counter this, he is working on what he describes as “a huge, beautiful skills development scheme”.
He admits to being positively influenced by the simplicity that US billionaire Warren Buffett has come to represent, and he describes Tibetan Dalai Lama as his guru.
He places great store on the strong historical and cultural links between South Africa and India and he regards coming to South Africa as his biggest ever opportunity.
He credits the Indian Prime Minister with his love for South Africa: “It arose from Mr Modi and my President also urged me to look for ways to bring South African talent to India. I said we could award some contracts to South African companies and we’ve awarded $400-million worth of contracts to various South African companies. They’ve started working in India and they’re very excited, and trust me, it costs me half the money we’re paying to Australians,” he added.
Given that the Western World is developed and that China has grown, he believes it is high time that the economies of India and Africa receive a boost.
“There are 1.3-billion people in India and 1.3-billion people in Africa. Africa is like a full body with South Africa as its head. How South Africa behaves, the whole body will behave because Nelson Mandela is the icon, not only of South Africa but for the whole of Africa,” he commented to Mining Weekly Online.
The demands for good governance, poverty eradication and the closure of the inequality gap being made in South Africa were also being made in India, and the time was right for India and Africa "to do things together,” he said, adding that “India has embraced technology and innovation and South Africa knows everything about mining so we could be a very good combination”.
While South Africa exported most of its gold to India, South African expertise might also be instrumental in helping India to discover its own gold resources through the deployment of modern exploration technology.
“I’m not obsessed with commodity pricing because I always say to my people, ‘you should be so efficient and your costs so low that you are the last one standing, and you should know how to take a shower with a bucket’”, he quipped.
On the appointment of AngloGold Ashanti CEO Srinivasan (Venkat) Venkatakrishnan as the new CEO of Vedanta from the end of August, he said that every South African Cabinet Minister, bureaucrat and businessperson he had come across on his recent visit had berated him for “stealing our Venkat, so I told them, he’s not going anywhere. He’s going to continue living in South Africa”.
He expressed delight at the investment enthusiasm of the newly appointed South African Cabinet Ministers he had met on his recent visit and is enthralled by the target set by President Cyril Ramaphosa to attract investments into South Africa totalling $100-billion.