Today’s edition
Grain Prix
Good morning. South Africa has 95 gigawatts of wind blowing past its coastline that nobody is legally allowed to lease, and a consortium of mining bosses wants to build a Formula One circuit on wheat farmland that Formula One has not yet agreed to race on. Plenty of ambition today, and not much permission. Let’s get into it.
MARKETS
RACE OFF
Mining bosses have hired Rothschild to build South Africa a R6.7 billion motorsport complex north of Cape Town
Africa has not had a Formula One race since 1993, and two South African groups now want the slot back. A consortium fronted by Neal Froneman, who used to run Sibanye-Stillwater, has hired Rothschild & Co to raise the money for a R6.7 billion motorsport complex on wheat farmland in the Swartland, north of Cape Town.
Toby Venter is coming at it from the other side. He runs Porsche South Africa and already owns Kyalami, the circuit that held the last one, and he has been upgrading it so he can rent it to whoever wins. One slot is on offer. One side has a plan and the other has a track.
What each side brings:
- About R2 billion of the Cape Town budget is the racetrack itself. The rest goes on conference and exhibition space, hospitality and housing.
- Room for 125,000 spectators, and the government’s condition is that no taxpayer money goes near it.
- Formula One’s evaluation of the bid runs twelve to fifteen months, so nobody finds out soon.
The prize has grown while Africa waited. Formula One is worth more than $23 billion today, against the $4.4 billion Liberty Media paid for it in 2017.
LEASE EXPECTED
South Africa has 95 gigawatts of wind off its coast and no legal way to lease the seabed
The wind off South Africa’s coast mostly blows over water too deep to plant a turbine in. A framework published this month by the Carbon Trust for the World Bank, with the energy department, puts the technical potential at 95 gigawatts, most of it off the west coast between Saldanha and Port Nolloth, where the turbines would have to float. None of it can be leased. No South African law lets the state hand a developer exclusive rights to a patch of ocean, and the framework’s second recommendation is that government work out who would even do it.
The buyers are easier to find than the law. Cape Town’s peak demand is about 2 gigawatts against 6.4 gigawatts sitting off its coast, and Durban’s is about 1.7 against 17.4. The framework points at data centres as the customers big enough to justify a build, and at Saldanha Bay’s port, which already services oil and gas rigs. Price is the part that stalls it. Every scenario modelled commissions the first project in 2035, at $94 to $126 a megawatt hour against the $32 onshore wind averaged at a government auction in 2021.
The benefit government likes to quote, more than 300,000 full-time equivalent job-years and $6.7 billion in wages, accumulates between 2030 and 2050. Job-years are not jobs.
BAGEL BITE
Vanilla flavouring comes from which family of plants?
A. Orchid
B. Fern
C. Cactus
DOING THE ROUNDS
Warren Wheatley built the first listed company in Africa to hold bitcoin as a treasury asset, and on Monday he resigned from it. The regulator found that four days of trading in shares of its forerunner, Altvest Capital, in 2022 created an artificially inflated price, and debarred him for 20 years alongside a R5 million penalty. Wheatley says it was 50 shares worth R301, traded while he tested a broker platform, and he is still fighting the finding at the tribunal. Stafford Masie stays on as interim chief executive. Full story →
Pick n Pay has spent three years trying to fix itself, and it has just hired the person who will finish the job. Spencer Sonn becomes chief executive-designate on 1 February 2027, arriving from Woolworths, where he spent 26 years and ran the food business as managing director for five of them. Sean Summers, brought back in 2023 after the group posted its first loss, stays until his contract ends in May 2028. That is fourteen months of the two of them in the building together. Full story →
If you have swum in a lagoon in Waterfall City, you have been in a Balwin development. On Tuesday it stopped trading on the JSE, almost eleven years after listing. Shareholders backed the R2.26 billion buyout with 98.48% of the votes and were paid R4.35 a share in cash on Monday. The buyer is the Public Investment Corporation, investing for the Government Employees Pension Fund, with founder Steve Brookes and managing director Rodney Gray putting their own money back in alongside it. Full story →
The Reserve Bank keeps an index designed to show where the economy is heading several months out, and in July it fell 0.9%, its second monthly drop in a row. Six of its ten available components weakened. The biggest drags were slowing growth in money supply and fewer plans approved for new flats, townhouses and larger houses, with softer export commodity prices and weaker manufacturing orders behind them. More job advertisements and longer factory hours pulled the other way. Business confidence, measured separately, edged down to 38. Full story →
WEATHER
BAGEL GAMES
Have you got what it takes to win today’s Wordle? Play here →
THE ANSWER
As for the Bagel Bite, the answer is: A. Orchid
Long answer:
The vanilla orchid produces long green fruits, commonly called vanilla beans, which are harvested and cured to develop their flavour and aroma. Commercial vanilla plants are usually pollinated by hand outside their native range, making production extremely labour intensive. Vanilla is widely described as the second most expensive spice after saffron. Vanilla planifolia is the main species used commercially.
That’s your Thursday wrapped. Enjoyed it? Forward it on, a friend can subscribe in a click. Written by the Business Bagel crew.