Independent Newspapers appears to be losing its state funding lifeline. The Minister of Finance Nhlanhla Nene has announced – by way of a parliamentary written reply to a question – that the Public Investment Corporation (PIC) is working on “an exit strategy in respect of its investment in Independent News and Media, South Africa”. He also confirmed in another reply that the PIC had decided not to invest in Dr Mohammed Iqbal Survé’s new venture, Sagarmatha

In reply to Alf Lees, the opposition Democratic Alliance deputy finance spokesperson, Nene said that owing to the sensitive nature of the information “the details of this strategy cannot be publicly disclosed”.

Lee asked whether the Public Investment Corporation “is working on an exit strategy in respect of its investment in the Independent Newspapers of South Africa; if not, why not; if so, what are the relevant details?”

The PIC invested about R800 million in the purchase of Independent Newspapers in 2013, when Survé bought the newspaper business – which includes The Star, The Cape Times, The Mercury and the Diamond Fields Advertiser – from Irish rugby star Sir Tony O’Reilly, who had owned it since the early 1990s. Some reports indicate this amount may have risen to R1 billlion or more since then.

It also emerged that the PIC – which manages the Government Employees Pension Fund of public servants – opted not to invest in a proposed new company, Sagarmatha, which was to have included Independent Newspapers.

In reply to another question put to the Minister by DA finance spokesperson David Maynier, about whether PIC chief executive officer Dan Matjila – or other PIC staff – had met Dr Survé since August 2013 to discuss investing in Sagarmatha Technologies Ltd, the Minister said: ’

“In line with the Public Investment Corporation’s investment and due diligence processes, the chief executive officer and other members of staff frequently meet with representatives of investee companies. Therefore, meetings were conducted between representatives of the PIC and Dr Iqbal Survé and other representatives of Independent News Media South Africa. The details of these meetings, however, are confidential.”

Asked specifically whether the PIC (a) was approached to invest and/or (b) invested in Sagarmatha Technologies Limited; if not, why not, in each specified case; if so, what are the relevant details in each specified case?         

“The PIC was approached to invest in Sagarmatha Technologies Limited but, following a thorough due diligence process, the PIC resolved not to invest in Sagarmatha Technologies Limited,” said Nene.

Independent Newspapers blamed the non-listing of Sagarmatha on a cabal of journalists whom he liked to the apartheid-era Stratcom. The entity was to have listed in April this year.

Survé was quoted in his own newspapers as saying that Tiso Blackstar – a rival media company which owns Business Day – “had actively attempted to scupper the listing, sketched a pattern reminiscent of Stratcom’s tactics”.

He said the dirty tricks campaigns extended to the professionals and regulators involved in the listing, including advisers and auditors. “The patterns that are emerging on the attacks on Independent Media and Sekunjalo Group and myself reeks of Stratcom. It has all the hallmarks of Stratcom and dirty tricks,” Surve was quoted as saying.

See Story from April in IOL, the Independent Group’s own website:

See Business Report, a mouthpiece of Dr Survé announcing that the listing of Sagarmatha had been derailed:

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