On September 21, the Friday before the Heritage Day weekend, WG Wearne, the building material supplier, announced that a little-known New York-based private equity firm, Milost Global, had come to its aid with up to R300 million in loan and equity finance attached to certain unspecified strings.
When the JSE reopened the following Tuesday, WG Wearne’s stock surged to R34 from its Friday close of R8, before sliding back to its previous trading band. On December 5, the Financial Services Board said it was eyeing the company’s securities for signs of possible insider trading in September.
Milost Global’s CEO is one Mandla Gwadiso. I asked him for an interview but he said I would have to wait until February because he was traveling. I understand I am not alone in receiving this kind of brush-off. From what’s in the public domain it’s clear that Gwadiso is a private person.
His company’s website features photographs of his team, but not of him. His face does not appear on his LinkedIn or Twitter profiles either. On the company site he says is “a reclusive rainmaker of note to his close circles”. His corporate cv gives no clue as to where hails from, where he was educated or where he lives now. Milost’s Wall Street and City adresses look high-powered but turn out to be virtual.
Gwadiso does, however, want the world to know he is a major fan of “King” Donald Trump, for whom he is a veritable twitter mbongi. A typical effusion: “Wherever you show up, you derserve (sic) a standing ovation Mr President…from every living creature in America.” Whoever was behind twitter account of his previous, now disbanded, firm, Milost Advisors, took a different view, retweeting kisses to Hillary Clinton during last year’s campaign.
What exactly is Milost Global? In the blizzard of press releases its puts out it describes itself as “an American Private Equity firm with more that $25 billion in committed capital”. It provides “alternative capital” to companies around world. In choosing acquisition targets it is “agnostic”. It is not afraid to list cannabis as sector in which it has dabbled. Just who is committing the billions is undisclosed, but the quantum alleged is stunning when you consider that private equity titan KKR’s fund for Europe and Africa (before it dropped Africa) is $6.2 billion.
Africa is a particular Milost focus. In August, the firm said it was launching a unit to buy banks in SADC and ECOWAS countries, with Canzi Lisa as chairman. Lisa, a Robben Island stalwart, was municipal manager of Bushbuckridge. A November release announced the launch of Isilo Capital Partners which aims to raise $5 billion for African transactions of $10 million of less. Tiny Diswai, formerly a manager at Debswana, is to be ILC’s CEO.
Last year, Milost approached a strapped Canadian education company, KICG, proposing a buyout that would theoretically end with the business restored to financial health through a listing in the US. KGIC’s CEO, Dr Alexander MacGregor, bit. Milost, he was led to believe, would help him acquire what is known as a Form-10 company. This is an entity for which the Securities and Exchange Commission has lowered accounting hurdles to a listing on a major US exchange such as the Nasdaq.
In September, MacGregor sued Gwadiso and Milost for fraud in New York federal court. He claims he ended up paying them $560 000 for a shell company they acquired for $80 000 and control of which even then was not transferred to him. SEC filings signed by Gwadiso suggest that 100 per cent of stock in the new company was in fact transferred to the Canadian last May. MacGregor wants a jury. It will be interesting to see if Gwadiso wants the publicity.