State capture report: Gigaba ‘a tool’ for Guptas

Former Cabinet minister Malusi Gigaba was just a tool in the hands of the fugitive Guptas, used by the family to parade their influence, the state capture commission has found.

The commission released the second part of its report on Tuesday. It covered findings on two state-owned enterprises (SOEs), the arms manufacturer Denel and Transnet.

The report detailed how the Guptas and their associates used VR Laser, a long-standing defence supplier to Denel, to capture the SOE. Gigaba frequented the family’s sprawling compound in Saxonwold, with the then Denel CEO Riaz Saloojee finding him there “soliciting SOE business for his friends”, the Gupta family.

Scathing on the relationship between the Guptas and Gigaba, the report likened it to what one of the brothers, Tony Gupta, “used to do with Duduzane Zuma”.

“There is no doubt that the Guptas brought minister Gigaba to the meeting with Mr Saloojee to show him that minister Gigaba was a mere tool in their hands, a dupe who would do their bidding and from whom Mr Saloojee could expect no protection.

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“A politician who did not recognise this to be so would be so naive indeed. It is the same as what, on the evidence heard by the commission, Mr Tony Gupta would bring Mr Duduzane Zuma along to meetings that he had with government officials attached to SOEs and he would do the talking and Mr Duduzane Zuma would simply be there but not really take part in the discussion,” reads the report.

In bringing Zuma’s son to meetings, Gupta believed that officials would realise that he had easy access to the former president through his son.

“In other words, they better cooperate because otherwise, their non-cooperation could be reported to president Zuma.”

Gigaba is a former minister of public enterprises.

Through their associate Salim Essa, the Guptas wrestled and purchased VR Laser from Benny Jiyane and his wife in 2015. VR Laser specialised in the cutting and bending of amour plate and steel. The couple had acquired a share of the company from shareholders John Van Reenen and Gary Bloxham.

At the time, Saloojee was CEO of a then profitable and solvent Denel. By 2015, the state company had assets valued at R9.7 billion and was sitting on R1.9 billion in cash. Its strategic markets had expanded to the Middle East, the rest of Africa, South America and the Far East.

Jiyane testified at the commission in 2019, detailing how he was duped after entering into an agreement with Essa. Unknown men showed up at his office while he was away during a festive season break.

Tony Gupta led the entourage and a “welcoming party” was held in the office.

ALSO READ: Ex Denel CEO brought Gupta’s VR Laser into the fold, Zondo hears

When he raised his concerns to former Transnet board member Iqbal Sharma, he told him to work with the strangers as they represented the “shareholder”. That was the start of a hostile takeover of VR Laser by the Guptas. New directors and the board did the bidding for the Guptas, who raked in billions in contracts while the SOE was crippled. Their lackeys were paid in bags of cash disseminated during meetings at Saxonwold.

Jiyane testified that he left the company after selling his shares, and had no knowledge of its dealings with Denel.

Gigaba’s conduct called for strong censure, although, according to the law, his conduct attracted no criminal sanction, the commission found.

The report decried the reputational damage suffered by Denel under the Guptas’ capture, and the harm on several individuals, who were forced out to ensure total capture by the fugitive family.

“The evidence shows that rebuilding Denel will take a long time, that is if Denel doesn’t go under. As at mid-2021, Denel was associated with litigation in the media and reported to be facing liquidation and has difficulties paying employees.”

The report recommended that law enforcement agencies conduct investigations into the suspension of executives at Denel during former public enterprises minister Lynne Brown’s tenure. In addition, a body should be established to clean up SOEs and recruit the right people as executives and board members.

Furthermore, the Department of Public Enterprises and the Intellectual Property Commission should take action against former board chairperson Daniel Mantsha and his board, whom it was found had abetted the capture of Denel.

“It is therefore recommended that they [state entities] all be asked by government to consider bringing such proceedings.”

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