British South Africa Company
Company logo and
|Predecessor||Central Search Association and the Exploring Company Ltd.|
|Successor||Charter Consolidated Ltd|
and their predecessor entities
|Cecil Rhodes (|
The British South Africa Company (BSAC or BSACo) was established following the amalgamation of
It has been suggested that Rhodes' ambition was to create a zone of British commercial and political influence from "
As part of administering
The Royal Charter of the British South Africa Company (BSAC) came into effect on 20 December 1889. This was initially for a period of 25 years, later extended for a further 10 years, so it expired in 1924.
The company had been incorporated in October 1888, and much of the time after Rhodes arrived in London in March 1889 and before its Charter was granted, was taken up in discussions on its terms. In these discussions, Rhodes led the BSAC negotiators. Although the British government broadly supported the scheme, it demanded that it and the
The BSAC was an amalgamation of a London-based group headed by
From the start, Gifford disliked Rhodes, who he thought had acquired too much power in BSAC and had marginalised him. Cawston supported Rhodes only in those commercial activities likely to make a profit and not in any less commercial ventures. The four other directors were appointed to represent the other shareholders. The dukes of Abercorn and
News of the Raid shocked the BSAC directors who, except for Beit and Grey, knew nothing of the plan. Rhodes at first denied responsibility for Jameson's actions but, in the face of further revelations, he assumed full responsibility for them. The BSAC Board recognised that the company would be attacked, and asked Rhodes to come to London to meet them. At a Board meeting of 5 February 1896, Rhodes claimed that he had given Jameson permission to assist an uprising only, not to start one, and that he believed had the support of the British government. He offered to resign as managing director, but a decision on this was deferred despite the demands of Cawston and Gifford for its acceptance. However, after the trial of the Jameson raiders implicated Rhodes further and following pressure from Chamberlain, Rhodes and Beit were removed as directors in June 1896.
After his removal, Rhodes remained a major shareholder in the BSAC and he continued to be involved unofficially in its affairs. In 1898, the Duke of Fife and Lord Farquhar both resigned from the Board; Rhodes and Beit replaced them and another supporter of Rhodes also joined the Board. As Rhodes had recaptured full control over the company, Cawston decided to resign. Lord Gifford, however, remained on the Board, which Rhodes dominated until his death.
Rhodes retained effective control of the BSAC until his death in 1902, but after the Jameson Raid the company's relations with the Colonial Office over Rhodesia were difficult, as the Colonial Office was unwilling to recognise the company had to give priority to its commercial interests rather than administration. After Rhodes' death, the BSAC directors attempted to make the company commercially profitable, but until 1924 it was deeply unprofitable because its administrative costs outweighed its commercial income, and it never paid a dividend in that period. After a financial crisis in Britain in 1908, the value of its shares declined sharply: its share capital had to be increased from £6 million to £12 million between 1908 and 1912, and it needed large loans to stay in business.
From around 1920, the company favoured a union of Southern and Northern Rhodesia, followed by their inclusion in the Union of South Africa, and it was in discussion with South African leaders about this. South Africa offered favourable terms for buying out the BSAC’s interests, and the company would be relieved of any future administrative costs. The BSAC did not want to be left with responsibility for the administration of Northern Rhodesia when Southern Rhodesia gained responsible government, but did want to preserve its commercial interests there, in particular its mining and land rights. To do this, it had to negotiate a settlement with the British government for both parts of Rhodesia. The two parties began negotiations in an atmosphere of mutual suspicion at the end of 1922, but nevertheless reached an agreement of 29 September 1923 to settle all the outstanding questions on Southern and Northern Rhodesia.
From 1925 until his death in 1937 Sir
After 1924 the BSAC's rights allowed it to collect vast sums in royalties, particularly from the development of the Northern Rhodesian Copperbelt, from the late 1920s until its mineral rights were liquidated just before Zambian independence in 1964. In the 1930s, the BSAC was able to collect royalties on all copper mined and was a large shareholder in the main mining companies. By 1937 its annual mining revenue was £311,000.