Paul Kirk
Armscor bosses are set to make a killing by buying arms from companies of which they are shareholders or directors.
This week the Mail & Guardian obtained Armscor documents showing that Armscor chair Ron Haywood is a director of another company, Dynamic Cables, which is among the front runners to supply key components for the controversial Ground Based Air Defence System that is to be acquired for the South African army. Armscor is the government’s arms procurement agency while, in this instance, Dynamic Cables would be a supplier to Armscor.
The acquisition of the air defence system, dubbed GBADS, does not form part of the controversial composite R50-billion arms deal. It will cost the taxpayer several billion rands more over roughly 20 years.
The winning tender for the GBADS contract will be announced at the end of next month. But the documents show that Dynamic Cables, which is bidding together with Log-Tek, a Durban-based company, is among the favourites to win.
The documents list all bidders, and rate three of them as preferred, among them Log-Tek/Dynamic Cables. The other two preferred are African Defence Systems of South Africa and Saab/Bofors/DynamicAB of Sweden.
The GBADS system comprises a network of electronically operated guns and short- and long-range missiles. The network is to be connected by sophisticated communications channels which is where Dynamic Cables comes in under the Log-Tek bid.
Keith Mokoape, a former head of intelligence in the African National Congress’s military wing, Umkhonto weSizwe, is in the same position as Haywood. He, too, is a director both of Armscor and Dynamic Cables.
Although Dynamic Cables will benefit from any award of the contract to it, it is unknown whether Haywood holds shares in the company and thus stands to benefit personally, as he failed to answer inquiries from the M&G. It is understood that Mokoape holds no shares in Dynamic Cables.
Representatives of Armscor told the M&G that only public affairs manager Minah Sindane could speak to the M&G with regard to GBADS. Sindane was on leave this week.
A search of the records of the Registrar of Companies shows Dynamic Cables has among its directors former defence minister Joe Modise, Haywood, Mokoape, director of Log-Tek Harry Spain, former ANC treasurer in KwaZulu-Natal Diliza Mji and Ian Deetlefs, a director of Denel and a South African defence force general.
Dynamic Cables and Log-Tek are private companies and are not owned by the state or Armscor. Armscor bosses on the boards of Dynamic Cables and Log-Tek are acting for the companies in their private capacities not on behalf of the state or Armscor.
When the M&G contacted Dynamic Cables’s Gauteng office, enquiries were referred to the Cape Town office, which said the only person allowed to speak to the media was Theodr Rai, its managing director. Rai was repeatedly said to be in meetings when the M&G attempted to contact him this week.
Attempts to contact Haywood for comment were also unsuccessful. When told he was unavailable, the M&G left several messages for him, but these went unanswered. His personal assistant confirmed that the M&G’s questions had been relayed to him. Haywood was asked, among other things, if his involvement with Dynamic Cables was not a conflict of interest.
Mokoape denied a conflict of interest in his being a director of Armscor, Log-Tek and Dynamic Cables.
Armscor’s own website shows Log-Tek to be accredited suppliers to the state arms procurement agency.
Mokoape joined the board of Armscor in June 1997 and accepted a directorship of Log-Tek in 1998.
Speaking from his executive suite in Log-Tek’s office complex, Mokoape claimed he had recused himself from all meetings involving contracts that may have been awarded to his own companies by Armscor.
Another Dynamic Cables director, Diliza Mji, is deputy chair of British Aerospace’s local subsidiary and was himself once an Armscor director.
Armscor representative Minah Sindane confirmed last month that Mji left the state arms procurement agency to join British Aerospace after he had been part of the decision-making process that led to British Aerospace being awarded the contracts to supply both jet fighter and trainer aircraft.
Mji insists he was head-hunted by British Aerospace and there was nothing untoward in his move.
Late on Thursday, Mokoape told the M&G: “I’m writing to Dynamic Cables this afternoon saying that I am not to be a director of the company.”