Zondo commission hears testimony related to failed R15bn SAA tender

The commission of inquiry into state capture will on Thursday hear testimony from the director of BNP Capital Daniel Mahlangu.

In 2016, BNP Capital was awarded a tender at South African Airways (SAA) to source R15 billion for the airline. However, the deal was cancelled and a recommendation was made that BNP Capital be paid a $5 million cancellation fee.

Ahead of the tea break on Thursday, Mahlangu told the commission that he came to know of the tender at SAA through the personal advisor of former SAA board chair Dudu Myeni, Masotsha Mngadi, who was referred to him, Mahlangu, by a “trusted” and “reliable” person.

Mahlangu said on February 9, 2016, he received an email from Mngadi in which Myeni’s personal advisor was introducing himself and also included the request for information (RFI) for the SAA tender.

Mahlangu told the commission that in the email Mngadi had stated that “time is of the essence” because the closing date to bid for the tender was February 16, 2016.

Mahlangu and Mngadi met thereafter, at a meeting where Mngadi mentioned that there was an opportunity available at SAA and gave Mahlangu an overview of it, as well as Mngadi’s experience as far as SAA was concerned, and he told Mahlangu that he was well versed on issues the airline was dealing with at the time.

These issues included confidential information such as the terms of the funding the big banks in South Africa had given to SAA.

Mahlangu told the commission that at the meeting, Mngadi also came up with solutions to assist SAA to “breathe” because the big banks were driving the airline to insolvency. The witness added that Mngadi “gave a deep understanding of some of the issues and what needs to be done” at SAA during this meeting.

Evidence leader at the commission on Thursday, senior counsel Kate Hofmeyer, asked Mahlangu if at any stage of the meeting he questioned Mngadi how he had acquired all the knowledge he had on SAA.

“Some of the information was publicised in news articles … I didn’t probe any further when he told me this is his client [SAA],” Mahlangu told the commission.

“The level of information that he provided … it [was] basically an analysis, basically what he said he understands SAA and SAA is his client, so, I wouldn’t try and second-guess him,” the witness added.

However, he conceded that in hindsight he now looks at things differently.

Hofmeyer asked Mahlangu if he had questioned why Mngadi had not bid for the tender himself, to which the witness responded that Mngadi had mentioned that BNP Capital would partner with his, Mngadi’s entity, Inline Trading.

“He said he was looking for a credible advisory firm [with the required experience] … so hence he wanted to partner with us. On the other hand, he was going to bring in aviation expertise,” Mahlangu told the commission.

The commission is chaired by Deputy Chief Justice Raymond Zondo.