DAVID GLEASON: TorqueWho is Timothy Tebeila, why does he occupy...

DAVID GLEASON: Torque
Who is Timothy Tebeila, why does he occupy a R50m pad in luxury Johannesburg suburb Sandhurst that boasts an in-house barber shop, and how does he afford all this along with a fleet of Benzes and a Rolls Royce?

Published:2011/12/06 08:16:45 AM

WHO is Timothy Tebeila, why does he occupy a R50m pad in luxury Johannesburg suburb Sandhurst that boasts an in-house barber shop, and how does he afford all this along with a fleet of Benzes and a Rolls Royce? Oh, I almost forgot, why are the Industrial Development Corporation (IDC) and Eskom involved with Tebeila, and is the IDC about to discover it has problems with the Australian stock exchange? Read on.


I’ve been approached by shareholders in an Australian- and JSE- listed company, Firestone Energy, who are concerned their company may have been pulled across the table by Tebeila in what they infer is a grand conspiracy more than three years in the cooking.


Tebeila, a former teacher, now heads the Sekoko Resources Group. In early 2008 he pulled off a series of deals with Firestone to support his intention of leading a major black- owned mining company. Firestone was a dormant but listed company whose only asset was cash.


Sekoko and its wholly owned subsidiary, Sekoko Coal, successfully secured prized prospecting rights for coal in the Waterberg, which holds a major portion of SA’s coal reserves. The rights Sekoko secured are contiguous to Exxaro ’s profitable Grootgeluk mine and were awarded by the Polokwane office of the Department of Mineral Resources.

It seems Tebeila struck three deals with Firestone which yielded Sekoko about R500m. The underlying rationale was that Tebeila promised to secure long-term off- take agreements with Eskom. In a groundbreaking announcement on December 17 last year he revealed he had sold a one-third stake in Sekoko to the IDC in return for an undertaking by the IDC that it would fund Sekoko’s R250m share of the development cost. Sekoko also said the deal was unconditional. In that process, the IDC became the owner of a large block of Firestone shares.

The effect was to increase the estimated value of Firestone’s shares to between 2,9 and 4,5 Australian cents and the counter quickly moved up to 2,7c. Sekoko owned about 1,2- billion Firestone shares and it seems Tebeila has sold about 400-million of these at prices significantly better than the current A$0,012.

Of course, the IDC announcement appeared, on the face of it, very promising and represented a significant start to a mining partnership between Firestone and Sekoko. Then some funny things happened. Tebeila resigned as deputy chairman and a director of Firestone, of which Sekoko happened to be the major shareholder. Then it transpired that the so-called unconditional deal he had struck with the IDC had some rather vital conditions attached.

In May Firestone announced it had signed a binding memorandum of understanding with Eskom. Then in July it announced th is was being extended by 90 days. Then Firestone announced it had authorised the Public Investment Corporation (PIC) to secure funding for the project, although the PIC’s task is to manage pension funds; not to take on the work of an investment bank.

Importantly, it seems Eskom has not entered into a memorandum of understanding of any kind with either Sekoko or Firestone or the so- called Waterberg venture, although I was unable to get comment from the utility. A letter to Eskom CE Brian Dames from an Australian law firm representing some Firestone shareholders has gone unanswered.


Just to add to the potential problem, it appears that the IDC’s ownership of a large portion of Firestone shares may be in direct contravention of the Australian Corporations Act. The IDC’s in-house general counsel, Prosper Chavarika, didn’t return my call.


Responding to a letter from Perth lawyers Tottle Partners, Tebeila wrote: "I don’t account to you and any shareholder but to my board of Sekoko. Unless you have no legal Bussness (sic) then you are free to write to me to lift up the earnings of your legal firm. Your clients has lots of spare money to pay you otherwise your firm will close down. I know that recession is not yet over to many firms I guess you were most affected. I’m busy please don’t disturb me."

From beginning to end there is something so curious about this saga that it demands investigation. I am given to understand senior IDC executives are now doing so and the IDC has meanwhile withdrawn its proposed funding arrangement.


The silence that has descended has become quite eerie.


If you dont believe this check the website and google tebeila.