A new info-scandal?

Will the Mbeki-ites succeed where Eschel Rhoodie & Co failed?

In the final passage of George Orwell's Animal Farm the animals peer through the window of the farmhouse where the pigs and the men had gone from carousing to arguing. "The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which."

South Africa may not be there yet, but it is certainly beginning to take a conscious effort to differentiate between our past and present rulers - such are the similarities in some of their actions.

This weekend it was reported that an obscure entity with close links to the presidency was planning to buy control over much of South Africa's free press. On Saturday Koni Media Holdings, a company established a year ago, announced that it was planning to spend R7bn to buy up Johncom - the company which owns (among others) The Sunday Times, Daily Dispatch, and 50% of Business Day and the Financial Mail. These are all publications which have been attacked by the presidency this year for their ‘irresponsible' reporting.

President Thabo Mbeki's political advisor, Titus Mafolo, and foreign affairs (and former ANC and Mbeki) spokesman Ronnie Mamoepa hold shares in Koni Media; as does Billy Modise, a former South African and ANC diplomat.

According to the Sunday Times Koni Media has approached the Public Investment Corporation - which controls the assets of government pensioners - to bankroll the bid. On Sunday the CEO of the company, businessman Groovin Nchabaleng, strongly denied "any involvement of the Presidency or any other government structures in its bid for a hundred percent stake in Johncom." He added that his Mbeki-aligned partners were simply "shareholders in their personal capacities."

There are striking parallels between this bid and an earlier effort by elements in the previous regime to surreptitiously take control of Johncom's predecessor: South African Association Newspapers (SAAN) in the 1970s. Then, as now, the newspapers owned by SAAN - the Sunday Times, Rand Daily Mail, and Sunday Express - were a thorn in the side of government.

In October 1975 the businessman Louis Luyt launched a takeover bid for SAAN. Although Luyt was a known nationalist, the reason for his sudden interest in purchasing these newspapers was unclear. He had no connection to the media business, having made his fortune in fertiliser. He vehemently denied any link to the National Party saying that he was acting purely "in his personal capacity." His efforts received a boost after Sir De Villiers Graaff, the former leader of the United Party, said that he was willing to join the bid through the purchase of a million shares.

The newspapers being targeted understood the implications of Luyt's bid. In a leader in the Rand Daily Mail Raymond Louw denounced this "right-wing attempt to grab the SAAN newspapers and mould their vigorously dissenting voices into unquestioning catspaws of the Nationalists."

When the Johannesburg stock-broker and Progressive Party supporter Max Borkum heard rumours of Luyt's plan he set about putting together the Advowson Trust to buy enough shares to block it. He persuaded the Bailey Trust, which wanted to dispose of some of its shareholding, to sell 15% of SAAN's shares to them (rather than Luyt), and they also secured another 5% from another group of investors. The Trust's shareholding of just over 20% - when combined with the share owned by the Argus Company and that still in the hands of the Bailey Interest - was enough to prevent SAAN from being taken over. The former editor of the Sunday Times, Joel Mervis, later observed: "Were it not for Borkum, SAAN would have been bought by Louis Luyt with tainted funds and forever used as an avowed instrument of party political policy."

The truth about who was really behind the bid was revealed in November 1978. This was when the press reported on the testimony, on October 4 1978, of Luyt to Justice Mostert's inquiry into exchange control irregularities.

In his testimony Luyt said that he had been approached at a rugby test match by General Hendrik Van den Bergh, the head of the Bureau of State Security, who said he was needed for some project. He was then contacted by Eschel Rhoodie, the Secretary for Information, who told him "they were in the process of taking over SAAN and that they wanted to use me, especially my name, and the fact that I was reasonably wealthy, and that the amount that was named for the shares was within my means."

The back story was that sometime in 1975, according to Rhoodie's later account, it was brought to the attention of Prime Minister John Vorster, Minister of Information Dr Connie Mulder, and himself, that SAAN was in difficulty and could be bought on the cheap. In the mind of Rhoodie the SAAN newspapers were presenting a slanted and distorted picture of the country to the outside world, and failing to give government credit for all it was doing to uplift the different population groups. The secret purchase of SAAN would be a "golden opportunity to rectify this state of affairs."

At a meeting in August 1975 at which Mulder and Van den Bergh were present a decision was made to try and buy the shares and take control. According to Rhoodie Van den Bergh told the others "to make use of the services of Luyt for the SAAN take-over, and that this was also Mr Vorster's wish."

When the resources of BOSS and the Department for Information were pooled there was enough money to finance the bid. After Vorster gave the go-ahead an initial R2m was transferred to Luyt. Soon afterwards news of the bid leaked out and Vorster called Rhoodie to his office. Rhoodie later claimed:

"During our talk Vorster was in a very jovial mood and he listened with undisguised pleasure when I told him that a state of near panic existed among the editors and senior journalists of the SAAN group. He urged me to be extremely careful, but to go ahead and see if we can still pull it off."

However, due to Borkum's efforts, the takeover of SAAN ran to ground. Rhoodie was now forced to set in motion the project to establish The Citizen. The rest, as they say, is history.

Secondary sources:

Eschel Rhoodie, The Real Information Scandal, (Pretoria: Orbis SA, 1983)

Joel Mervis, The Fourth Estate, (Johannesburg: Jonathan Ball, 1989)