Gordhan threatens legal action against Parliament to prevent SIU investigating SAA deal

Public Enterprises Minister Pravin Gordhan has threatened to take Parliament to court for proposing that the Special Investigating Unit (SIU) look into the collapsed deal between South African Airways (SAA) and Takatso.

The Portfolio Committee on Public Enterprise met on Wednesday to consider and adopt a report on its work regarding the controversial sale of 51% of SAA shares to the Takatso Consortium, which was formed by investor firm Harith General Partners and Global Aviation.

Gordhan recently announced that the sale was off amid allegations of irregularities about the deal.

Although the minister has maintained that the transaction was not irregular, the parliamentary committee last week resolved to refer the matter to the SIU for further investigation.

SIU must investigate

During Wednesday’s meeting, MPs stood firm on its decision to recommend that the SIU intervene.

“The SIU must further investigate because… as we are seated here we don’t know what happened, but there’s something fishy about the deal.

“The problem is that now we are talking about something that is no longer there and has been withdrawn,” ANC MP Thokozile Malinga said.

ANC MP Nkosinathi Dlamini shared the same sentiments, saying the committee would not allow Gordhan and the Department of Public Enterprises to dictate how Parliament should perform its oversight function.

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“As the legislature arm in terms of the doctrine of separation of powers, we oversee the executive. They don’t oversee us [and] we don’t account to them.

“If we continue this exchange between us and the department, as if the department must tell us how to conclude on this matter, it will not take us any way forward.

“Part of the things that are said in the letter are confirming the correctness of our decision in that we are not able to establish facts because there’s one accusation, and a counter accusation.

“We are not equipped to investigate these allegations, therefore, a competent body with investigative powers should take this matter forward [and] this will then help us,” he told his fellow parliamentarians.

Dlamini emphasisied that the investigation would reveal if former Public Enterprises director-general, Kgathatso Tlhakudi was lying about the SAA deal as alleged by Gordhan.

Watch the meeting below:

Gordhan threatens court action

EFF MP Nqobile Mhlongo criticised Gordhan for “throwing tantrums” and his “undertone of disrespect” in his reluctance to hand over key documents relating to the sale as well as for asking MPs to sign non-disclosure agreements.

“I don’t think we appreciate the drama he put us through to get the reports we had asked him to produce or give to the committee. So he was really not cooperative… he was very reluctant on sharing any documents,” she said.

Mhlongo also indicated that the committee didn’t “appreciate” Gordhan’s letter sent before Wednesday’s meeting started.

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The letter allegedly signalled the minister’s intention to take legal action against the committee for its referral to the SIU.

“If the minister feels that he should take this committee report to court for review, he is more than welcome to do so.

“It’s a democratic country and those are the avenues that are afforded to all citizens and the department as well, but our [view] is that this report must be adopted and we want the Special Investigating Unit to investigate this [deal] because we are not competent to investigate if a signature is legitimate.

“We are not going to play that game, therefore, it is best to hand over this matter to the authorities,” the EFF MP added.

The committee later adopted its report and will be sent to the National Assembly for its consideration.

Last week, the Department of Public Enterprises slammed the committee for its referral to the SIU, saying the call for an investigation was misleading the South African public by insinuating impropriety regarding the SAA deal.

Tlhakudi allegations

Questions about SAA’s sale to Takatso were raised following Tlhakudi’s allegations about the deal.

The former director-general asserted, in a protected disclosure to Parliament, that Gordhan handpicked Takatso even though the consortium was not originally shortlisted as a preferred strategic equity partner to the transaction.

The sequence of events began with Rand Merchant Bank (RMB) being appointed as the transactional advisor in the initial phase.

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It is alleged that RMB had identified four companies on its shortlist – and Harith and Global Aviation was not one of them.

Later, the Department of Public Enterprises set up an evaluation committee to handle the shortlisting process after RMB pulled out as transaction advisers.

The other allegation made by Tlhakudi related to the undervaluation of SAA.

The Citizen previously reported that SAA was sold for a meagre R51 to Takatso for 51% of the airline’s shares.

SAA deal above board?

Now the committee believes Gordhan and his department has not provided sufficient reasons as to why an internal team was appointed as the advisor or why Takatso had been shortlisted in the second phase of the transaction.

The committee also raised questions about the original valuation of SAA.

“From what is in the media, it appears that government buckled under pressure and walked away from the transaction because of this very reason. The figures which the Department of Public Enterprises had agreed to regarding the sale of SAA are worlds apart from the current valuations and this leaves much to be desired,” the committee’s report reads.

Additionally, the committee indicated that it cannot whether the SAA deal was “above board” and will, therefore, recommend that law enforcement agencies “do their work in unravelling the truth about this transaction” particularly the alleged forgery of Tlhakudi’s signature in the strategic equity partner appointment process.

The former director-general alleged that he did not sign the so-called Molisane memorandum and was not part of the evaluation committee that had chosen the consortium led by Global and Harith as the preferred bidder.

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