It was business as usual for national lottery operator Uthingo after the Pretoria High Court on Monday set aside Trade and Industry Minister Mandisi Mphahlwa’s decision to award the lottery licence to Gidani.
Judge Willie Seriti ruled that the process followed by the national lotteries board was flawed.
He said the board had failed to investigate the shareholdings in the first preferred bidder, Gidani, and the second preferred bidder, Uthingo.
That information was material for the minister to apply his mind properly under the Lotteries Act, he said.
The board’s failure to obtain information about the shareholders had resulted in Uthingo being recommended as the second preferred bidder despite Education Minister Naledi Pandor — ”obviously” a political office-bearer — having shares in a company with a stake in Uthingo.
The judge said this finding made it unnecessary to rule on legal argument that the winning Gidani consortium was also excluded because its shareholders included two members of the African National Congress (ANC) national executive committee, Chris Nissen and Max Sisulu.
The minister and lotteries board insisted that they did not regard the ANC members as political office-bearers under the Lotteries Act.
The court was informed that Pandor had sold her stake in Black Management Forum Investments (BMFI), which holds 10% of Uthingo, a few days before the court case commenced.
Uthingo claimed it only became aware of Pandor’s shareholding in BMFI in January.
The court ruling puts the whole lottery-licence matter back in Mphahlwa’s hands.
Uthingo’s licence expires at midnight on March 31.
Uthingo chief executive Dr Oupa Monamodi was ”ecstatic” about the ruling, as he had always maintained that the process was flawed.
”For Uthingo, it’s business as usual … The logical outcome of the ruling is that Uthingo will be expected to feature in some way as the national lottery operator,” he said.
Gidani chairperson Dr Bongani Khumalo said they needed to study the judgement before making a decision about ”the road ahead”.
He said Gidani had spent hundreds of millions of rands preparing to take over the lottery.
”Our style is not to be deterred. We will continue to follow the process of the law. We are determined to serve the people of South Africa,” he said. — Sapa