Who’s really benefitting?
Lesotho Flour Mills CEO’s lucrative housing deal sparks conflict of interest scandal
TEBOHO KHATEBE MOLEFI and
MOTSAMAI MOKOTJO
MASERU – Former Lesotho Flour Mills (LFM) chairman, Mohlomi Rantekoa, has denied allegations of impropriety after Public Eye uncovered that CEO, Fourie Du Plesis, has been renting his Ha Hoohlo residence for an estimated M40 000 per month – raising serious conflict-of-interest concerns.
Despite LFM’s obligation under Section 4(e) to provide “acceptable standard housing” for management, including utilities and security, the arrangement has drawn scrutiny -particularly since Rantekoa chaired LFM’s board from 2016 to 2024.
Du Plesis was appointed company CEO in 2024 whilst Rantekoa was still chairman of the board.
The deal contradicts a 2019 joint report by government and the African Legal Support Facility’ (ALSF) ‘Due Diligence Report 2019’, which called for the nullification of LFM’s management contract with Seaboard Overseas and Trading Group.
The report noted: “The management agreement appears overly generous. Beyond the $300 000 annual fee, LFM covers vehicles, insurance, housing, and allowances – benefits that should ideally be included in the management fee.”
The contract, active since 1999, mandates annual inflation-adjusted payments to Seaboard, with no clear expiration date – a point critics argue entrenches financial exploitation.
When confronted, Rantekoa confirmed Du Plesis was his tenant but refused to disclose the rental amount. He said “Do you ever ask people such questions? I need to speak to my lawyer before I commit.”
A source with inside knowledge of LFM’s affairs disclosed that the company is paying rent for CEO Du Plessis’ residence, rather than Seaboard, the management firm overseeing LFM.
“The CEO moved from a cheaper house costing M25 000 per month to a more expensive one at M45 000, owned by Rantekoa. This is unusual and should ideally require board approval,” the source explained.
The situation has raised concerns about governance failures within LFM, prompting calls for a thorough investigation.
“The unfolding scenario demands scrutiny into what has rendered the company ineffective,” the source added.
Another insider pointed to Seaboard’s long-standing mismanagement, stating: “Seaboard has failed to effectively manage the mill for 27 years, yet they continue to receive annual management fees.”
Current LFM chairperson, Mazvi Maharasoa, declined to comment, despite her board’s alleged role in approving executive allowances.
Former Ministry of Finance Principal Secretary (PS), Motena Tšolo, who was in office when the report was issued, stated in a separate interview that she was aware of the report but had not been privy to its recommendations.
“What I know is that we asked the ALSF to interrogate the deal between the government and Seaboard, where suggestions were made. Honestly, I can’t recall whether it was a report that was discussed,” Tšolo said.
With millions in public funds at stake, the scandal highlights potential self-enrichment at the expense of corporate governance and as scrutiny grows, stakeholders demand transparency, and answers.
Thabo Moleko, PS in the Ministry of Agriculture, confirmed to this publication that cabinet recently held a meeting regarding the status of the LFM. However, he admitted he was not fully aware of the meeting’s details.
“I don’t play any role in issues related to LFM. I only heard that matters concerning the company are being handled by the Ministries of Finance, Trade and of Agriculture,” Moleko stated.
He added, “I heard the Minister of Agriculture, Thabo Mofosi, mention that they were set to meet with the Ministers of Trade and of Finance before reporting back to the full cabinet.”
Moleko further revealed that he had seen an executive agenda concerning LFM, which was supposed to be presented last week.
However, he noted, “Since these are confidential matters, I don’t know what was discussed.”
In a further twist, it was revealed that LFM purchases grain at low prices from Globalery, a company that owns a 1 percent stake in the milling firm.
“This raises serious conflict-of-interest concerns and warrants an investigation into the company’s operations,” the source emphasized.
The arrangement may also violate Lesotho’s Anti-Dumping Measures, particularly Section 11.1.2, which prohibits the sale of subsidized foreign goods at discounted prices, undermining local industries.
Dumping refers to the sale of imported manufactured goods in Lesotho at below-market prices, often due to foreign government subsidies – a practice that harms domestic businesses.
The revelations highlight potential financial irregularities, governance lapses, and conflicts of interest within LFM. Stakeholders are now urging authorities to conduct a full audit and take corrective action to safeguard the company’s future.
But, former prime minister, Dr Moeketsi Majoro, who served as finance minister at the time, has indicated that he would soon disclose all details related to LFM once he concludes his farming activities.
“When I return to Maseru and am ready, I will reveal everything about the company,” Majoro said.
