BPOPF reviews P3.5bn Kgori Capital mandate as Seretse resigns amidst money-laudering storm

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Founding shareholder and managing director (MD) of Kgori Capital, Bakang Seretse has resigned from the fledging fund management company following his appearance in court last week over money laundering charges.

Seretse, along with business partner, Botho Leburu and BERA executive director, Kenneth Kerekang were released on bail on Friday in a case reportedly centred on funds withdrawn from the National Petroleum Fund (NPF).

“Yes, following his suspension from the company late last week, which was meant to give him time to deal with the issues he was facing, Mr Seretse today tendered his resignation. He provided us with a statement, which was basically explaining what happened and to confirm that this has nothing to do with Kgori Capital.

It’s a personal matter. We have since shared the information on his statement and his resignation with our clients, just to demonstrate that the company is not in any way involved in the matter,” Kgori Capital chairperson, Tebogo Naledi told Mmegi Business yesterday evening.  

Kgori Capital has been administering the NPF since January 2016 after winning the tender, previously held by Stanlib.

 Apart from repaying retail oil companies when there is under recovery in the market, the Fund is also used to finance construction of the country’s strategic oil storage facilities.

Seretse holds 31% shareholding in the company that has about P5 billion in assets under management.

Naledi said the rest of the shareholders will now meet soon to discuss the issue of Seretse’s shareholding.

“He is a major shareholder and he is also party to a shareholder agreement which has certain conditions,” Naledi said. “We will soon meet to deliberate on the issue of Mr Seretse’s shareholding,” he added.

Founded five years ago, as Afena capital, Kgori has expanded to become one of the most active and visible asset management companies in the country.

Industry players say Kgori’s rapid rise in the industry is largely due to the backing received from   the cash–rich, Botswana Public Officers Pension Fund (BPOPF) in the last few years.

Kgori’s mandate from BPOPF is currently sitting  at P3.5 billion, a contract in which they are supposed to invest only in listed companies.

 Asked if the Fund was taking any action on the matter, BPOPF managing director Boitumelo Molefe yesterday told Mmegi Business that they have met with the Kgori board and they are reviewing the mandate.

“We have met with the Kgori board and they have given us their side of the story after they met with Bakang following his release on bail. We will now meet with our investment committee this week and then make a presentation to the board of trustees early next week.  The board will have the final say on the matter,” she said.

BPOPF is also reportedly currently withdrawing a P830 million mandate from Capital Management Botswana (CMB) over breach of contract. Molefe confirmed the dispute with CMB, but was however not willing to divulge finer details on the matter citing client confidentiality.

 Last year, the Fund, which has assets worth around P60 billion, also withdrew a P4 billion mandate from Fleming Asset Management Botswana saying it had discovered irregularities at the fund manager.

Kgori has seen its client base grow to over 22 institutional clients over the past four years, with corresponding assets under management now in the P5 billion ballpark.

Last year, management at Kgori took over total control of the firm, in a deal that was seen as a triumph for citizen empowerment in an industry dominated by foreign controlled firms.

 In the transaction, the local management team acquired an additional 51% in the Botswana firm from South African parent company, Afena Capital.

The asset management firm started operations in Botswana about five years ago with Seretse as the MD, Alphonse Ndzinge (chief investments officer) and Sharifa Noor (chief operations officer).

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