JOHANNESBURG – The Sishen Iron Ore Company (SIOC) Community Development Trust, is set to generate hundreds of millions of Rands for community service in the Northern Cape and Limpopo in coming years. The trust was officially launched on Thursday 4 December at the Hilton Hotel in Johannesburg.
The trust, popularly known as the “Super Trust”, was officially launched by Ms Dipuo Peters, Premier of the Northern Cape, at a function in Sandton on Thursday evening. It was established when the former Kumba Resources was unbundled in September 2006 to form Exxaro and Kumba Iron Ore (Kumba). Kumba is the majority shareholder in SIOC, which owns iron ore mines in Thabazimbi (Limpopo) and Sishen (Northern Cape).
Since its establishment just over two years ago the trust has earned R211 million from its shareholding in SIOC.
The trust is the sole beneficiary of a 3% ordinary shareholding in SIOC. Thanks to the strong performance of Kumba Iron Ore over the past two years the R458 million in preferential shares issued to pay for the trust’s SIOC shareholding may be redeemed as early as 2010, well in advance of the original projections, said Chris Griffith, Chief Executive of Kumba, at the launch. “This will free up an estimated more than R100 million per annum for community development projects.”
He said that of the dividends paid to date, R196.5 million was used to redeem the preferential shares. He presented the trust with a cheque for the remaining R14.5 million. This includes R5 million for projects already initiated since the establishment of the Trust.
Connie Molusi, Chairperson of the Board of Trustees of the “Super Trust” said that the mines’ neighbouring communities were the main beneficiaries of the trust. Five independent community organisations, of which one is in Thabazimbi, have been identified as beneficiary trusts for channelling funds and resources to these communities. The Thabazimbi Development Forum will look into the needs of the communities around the Thabazimbi mine. The other organisations are based in the Northern Cape.
Premier Peters said that the launch of the trust was a milestone event in the history of Kumba and the Sishen Iron Ore Company (SIOC), as well as the Northern Cape and Limpopo provinces. “This initiative is bound to impact greatly on the development of the mentioned areas. More importantly, however, it is will touch the lives of thousands of our people and create a better tomorrow for them.”
She congratulated Kumba on its decision to make the host communities of its mines, co-owners of the company through the establishment of the “Super Trust”. “This is true empowerment where it is needed the most… at grassroots level.”
Too many companies are still practising a new form of economic imperialism from their cosy corporate offices, she said. “Once the ore is on the ship to China and the money is in the bank in Gauteng, they couldn’t care less about the communities where they operate.” However, things are changing, thanks to the efforts of Government and of companies such as Kumba, Ms Peters said.
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