Africa Business Briefs

Eskom in PPA with IPSA JOHANNESBURG – The IPSA Group said that its subsidiary Newcastle Cogeneration (NewCogen) has entered into a new power purchase agreement with South Africa’s power utility Eskom. Under the new agreement, all electricity at the 13 megawatts Newcastle Cogeneration would be sold to Eskom up until March 2015, the company said in a statement. NewCogen, which owns and operates South Africa’s first gas-fired independent power plant, has been supplying power to the grid, since the plant re-started in June this year, under a short-term agreement with Eskom which expired on Tuesday.

Metropolitan profit up 13%
JOHANNESBURG – South African insurer Metropolitan reported a 13 per cent rise in first-half profit yesterday, as a slow economic recovery helped its mainstay low and middle-income customers. Metropolitan, South Africa’s fourth-largest life insurer by market value, said diluted core headline earnings per share totalled 70 cents in the six months to end-June, compared with 62 cents a year earlier.
Net insurance premiums received rose by three per cent to R4,96 billion. Metropolitan, which is due to be absorbed by larger rival Momentum, said it was helped by cost cutting and a rise in the value of investments.

Angola ups gasoline prices
LUANDA – Angola yesterday announced a sharp increase in gasoline and gasoil prices triggered by a reduction in state subsidies aimed at saving government money, but the move could trigger strikes by unhappy taxi drivers.
The price of a litre of gasoline will increase by 50 per cent to 60 kwanzas while gasoil prices will increase by 38 per cent to 40 kwanzas per litre, according to a statement by state-owned oil firm Sonangol.
The goal is to cut back on state subsidies for gasoline and gasoil by an average 20 per cent each year, the Economy Ministry said in a separate statement. The state spends about 440 billion kwanzas (around US$4,8 billion) in gasoline and gasoil subsidies each year. The money saved by cutting back on these subsidies will be used to improve living standards in Angola, the Economy Ministry said.

SA sympathy strike suspended
JOHANNESBURG – South Africa’s largest union yesterday suspended a one-day sympathy strike this week that could have shut mines in order to give about 1,3 million striking state workers more time to consider a new wage offer. Unions representing the state workers, who have been on a three-week strike, were expected to announce yesterday afternoon whether they will accept a new government offer aimed at ending the action that has shut schools and caused chaos at hospitals.
“The intention of the suspension of the secondary strike is to give public servants sufficient time to consult with members and the state to finalise its talks with labour,” the National Union of Mineworkers (NUM) said in a statement. In a separate labour action, about 70 000 workers seeking 20 per cent wage increases at petrol stations, garages and auto dealerships walked off the job yesterday.

First private listing in Algeria
ALGIERS – An Algerian insurance company will later this year become the first private firm to list on the Algiers stock exchange, encouraged by government reforms, the firm’s chief executive said.
Algeria’s stock exchange lags far behind the bourses in neighbouring Morocco and Tunisia. It has very low liquidity, has only seven quoted companies and the last time any firm floated equity on the exchange was ten years ago.
Oil and gas exporter Algeria has Africa’s fourth-biggest economy but its stock exchange has been held back by restrictions on financial transactions and a business environment that is dominated by the state.
Hassen Khelifati, chief executive of Alliance Assurance, said at least four other companies planned to list on the Algiers exchange between now and 2011, though he did not name them. He said his company would seek to raise 1,4 billion Algerian dinars (US$18,59 million) in October by issuing 1,8 million shares with a price of 830 dinars per share.

Standard Bank ‘poaches’ banker
JOHANNESBURG – South Africa’s Standard Bank has hired Standard Chartered’s former head of transaction banking in Africa, as it looks to do more deals between Africa and Asia.
Hasan Khan has been hired as head of Standard Bank’s transactional products and services business, part of its African corporate and investment banking division, a spokesman for the South African lender confirmed.
By hiring Khan the bank is looking to capitalise on growing trade flows between Africa and Asia, the source said. Standard Bank is 20 per cent owned by Industrial and Commercial Bank of China, the world’s most valuable bank.
Standard Bank, Standard Chartered and Barclays are among the banks jostling for more Africa-related business.

DR Congo opens tax probe
KINSHASA – The government of the Democratic Republic of Congo is opening an investigation into alleged embezzlement involving a Canadian mining firm, First Quantum Minerals, an official said. The allegations concern tax fraud, Bene M’Poko, the government’s coordinator for investment and natural resources, said.
In a statement, First Quantum strongly denied any wrongdoing and said the government’s behaviour raised “grave” concerns. The DR Congo government and First Quantum are currently appearing before the commercial chamber of the international arbitration court in Paris after the cancellation in August 2009 of a contract linking the two parties to Kingamyambo Musonoi Tailings.
The project operates in Kolwezi and First Quantum is a majority shareholder.

Lafarge SA to retrench workers
JOHANNESBURG – Cement manufacturer Lafarge SA plans to retrench 13 per cent of its workers at its Lichtenburg plant in South Africa, a union said yesterday. The union, Solidarity, said it had been served with a notice by the company indicating its plans to retrench about 80 of its 600 employees by the end of October.
“Lafarge Cement maintains that the shrinking of the construction industry owing to the recession and the rising cost of electricity is the reason for the planned layoffs,” the union said in a statement.
Solidarity spokesman Dirk Hermann said job losses in South Africa’s manufacturing sector dropped by 74 000, while 54 000 people lost their jobs in the construction sector during the second quarter of 2010.

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