Sikalesele-Vaka braces for the fight of a lifetime
Mbongeni Mguni | Friday June 15, 2018 12:51
In April 2011, Regina Sikalesele-Vaka stunned a room full of dignitaries attending her farewell dinner with a speech that railed against the domination of South African giants in the Botswana financial services sector. A month earlier, Sikalesele-Vaka had quit as CEO of Botswana Insurance Holding Limited (BIHL) and at her farewell dinner, she detonated a truth bomb on citizen empowerment in the financial services sector. BIHL, the country’s largest diversified financial services group, is majority owned by a South African group.
“As a responsible corporate citizen, BIHL should participate in stimulating the economic growth of Botswana instead of releasing capital for the development of other economies.
“After all, these profits are derived from the citizens of this country,” Sikalesele-Vaka said, as her audience sat in pin-drop silence. Audience members, including executives from the South African group, shifted uncomfortably in their seats as Sikalesele-Vaka said Botswana had been used as “a proverbial cash cow” and had been stunted for the profits of the foreign company.
A few years later, the former CEO was embarking on her dream of setting up the first citizen-owned life insurance company in a market dominated by a handful of entrenched and highly competitive players, including the subsidiary of her former employer. Bramer Life was established in 2014, but a year later was in statutory management after one of its shareholders, a Mauritian company, ran into legal troubles. The dream appeared doomed to fail even before it had gathered momentum.
Help would come from local pensioners via the Botswana Public Officers Pension Fund (BPOPF), which had set up a +P400 million private equity investment fund run by asset management firm, Capital Management Botswana (CMB). The fund, known as Botswana Opportunities Partnership (BOP) took up 40% in Bramer Life, CMB snapped up 25% and 10% was allocated to the insurance company’s staff.
Sikalesele-Vaka as founder and CEO retained 25% and the company was rebranded to Bona Life. Under the deal, Sikalesele-Vaka was responsible for strategy, BOP provided the capital and CMB was the asset manager.
Today, an acrimonious fall out between BPOPF and CMB over ownership of the BOP has pushed Bona Life to the brink of collapse, while Sikalesele-Vaka has found herself in asset management firm’s crosshairs, after complaining to the insurance regulator about CMB’s management of P133 million in annuities held on behalf of the insurance firm.
BPOPF and CMB are presently sparring at the Court of Appeal and should the asset management firm win, Bona Life can no longer claim to be a citizen-owned company.
In March, CMB wrote a letter of demand for P650 million claiming the Bona Life CEO was mismanaging their investment. Last month, the asset management firm wrote demanding that Sikalesele-Vaka quit due to an “irretrievable breakdown of relations”.
The Bona Life board has not sat in ages due to the dispute and cash flows at the insurance firm that are tightening daily due to the shareholder stalemate as well as the dispute between Sikalesele-Vaka and CMB.
Is the dream over?
“I want to make sure the dream I had does not die and I’m prepared to do whatever it takes to make sure it continues. How can I take Batswana and put them here, then leave them?
“There are many ways of fighting. There are people who are combative and they come with weapons of mass destruction. Then there are other subtle ways of dealing with things behind the scenes until they click.
“I’m not giving up. Sometimes you feel you have done enough and have taken it to where it needs to be and that someone else must take over. I will reach that point when I feel the dream will be sustainable. The person coming in must find the fundamentals there. “I cannot go out before I achieve my dream; that would be giving up,” Sikalesele-Vaka says.
Surviving the Mauritian troubles of 2015 and building up a considerable portfolio in a market dominated by giants had set Bona Life on a course for success. For Sikalesele-Vaka, these achievements were another milestone in a glittering career marked by rapid professional progression.
The Bona Life founder was only 32 when she was appointed Motor Vehicle Accident Fund CEO, before joining Botswana Life as CEO. She has held directorships in numerous high profile organisations and is regarded as one of the luminaries of the financial services sector. The latest challenge threatens to not only smear Sikalesele-Vaka’s brand, but also unravel her plans to enhance citizen ownership in the financial services sector.
“I applied so much effort in building Bona Life because I had a view about the financial services working for this market and our money circulating in our own economy.
“The 40% from BOP takes that view broader because it brings in pension fund members. For me, this is almost like national service; it’s something I believe in and something that can be sustained.
“The next strategic agenda would have been listing Bona Life on stock exchange which would allow other Batswana to have a stake. “I could leave knowing that I have created a company that’s in the hands of Batswana,” she says.
Sikalesele-Vaka continues: “In establishing this company, I went to the market to sell it. I used my personal brand to create it and we now have a sizeable annuity portfolio.
“I have a responsibility to those people. They came to Bona Life because of me. “The thought of leaving the company now is a non-starter for me.” As the stalemate continues, the CEO reflects on the path that has led Bona Life to its current state. A particular source of unhappiness is the fact that Bona Life’s future rests in decisions it cannot control; a Court of Appeal fight and arbitration between BPOPF and CMB.
“I’m unhappy. Not only because I find myself in this situation, but also because of the manner in which that happened. If this happened due to board approvals, it would give me a chance to say do I want to be part of this? Not some secret thing happening elsewhere.
“In terms of Bona Life’s finances, from what I’m sensing and seeing, I think we are almost there, but there’s the other dimension of BOP, which I’m not in control of.
“As Bona Life we have made a lot of progress, but the caveat about the BOP is very important.
“We are stuck between the type of decisions we need to take and we cannot even take them. We are doing the best we can under the circumstances and for now, I’m still very much on the job.”