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MODERN MINING
March 2017
feature
MINING CONTRACTING
T
he Fund will operate in a unique
niche, providing investment of be-
tween R30 million and R200 mil-
lion to qualifying South African
junior miners. Importantly, the
Fund will support qualifying South African
junior miners both in respect of operational
expertise and financial stability.
Jaltech describes itself as an “African bou-
tique corporate advisory firm focused on
providing actuarial and corporate finance
services to clients across the African conti-
nent.” It has a long-standing relationship with
Stefanutti Stocks, a well-established construc-
tion, mining and processing company, which
will provide contract mining and processing
services as well as appropriate on-demand
guarantees against mining production volumes
and processing quality – vastly reducing the
operating and financial risks usually associated
with junior miners.
“Junior miners globally often struggle to get
affordable funding from financial institutions,
particularly given recent depressed commodity
prices. This is even more so in South Africa,”
says Gaurav Nair, Director of the Fund. “This
gap has been recognised by the South African
government who have sought to address the
As anyone involved in mining will know, there are many projects in the mining space that are large
enough to involve relatively significant amounts of capex and yet are too small to attract traditional
private equity funding. To cater for this niche in the market, Jaltech and Stefanutti Stocks have
launched the JSS Empowerment Mining Fund. The fund’s target capital is R1 billion.
The JSS Empowerment
Mining Fund was
introduced to the media
in Johannesburg in late
January. Seen here (from
left) at the event are: Russell
Crawford, MD of Stefanutti
Stocks Roads, Pipelines &
Mining Services BU; Gaurav
Nair and Derrick Hyde,
both directors of the Fund;
and Ian Ferguson, MD of
Stefanutti Stocks Mining
Services (photo: Arthur
Tassell).
New fund
backs junior miners
needs of small to medium business owners to
grow their business and contribute positively
towards the stimulation of the economy.”
The Fund is one of just 43 entities in South
Africa operating under the Section 12(J) of the
Income Tax Act (Act 58 of 1962) for venture
capitalist companies and will offer investors
several benefits. These include returns in excess
of CPI + 10 % per annum on the gross invest-
ment amount (which, when the tax deduction
is considered, can translate to considerably
higher returns on the net investment) and a
100 % deduction from an investor’s taxable
income in the year of investment. Also signifi-
cant is that there is ongoing recognition of 70 %
of the once-off spend towards the investor’s
B-BBEE scorecard (in terms of the DTI Code)
for every year the investment is held while the
Fund is invested in qualifying investments.
The Fund’s board and investment com-
mittee brings to the table executive-level and
governance experience in leading (and often
listed) companies in various industries. Key
players on the board include Chairman Mpho
Makwana and directors Derrick Hyde, Mano
Moodley, Gaurav Nair and Zukie Siyotula.
Investment committee members have exper-
tise in geology, mining engineering, mining
operations across the whole
value chain, mining invest-
ments and development,
mining finance and audit-
ing, mining contracting,
and corporate and project
finance. The investment
committee is chaired by
Zukie Siyotula and its mem-
bers are Dr John Hancox,
Vinay Somera, Derrick
Hyde, Frik Venter and
Nthabi Ledwaba.
To mitigate the risks
associated with junior min-
ing ventures, the Fund
will only consider projects
which have a confirmed
resource with a Competent
Persons Report in place