Saudi stake in Denel is off, says minister

“There was an offer from Saudi to invest in Denel, not buy a stake. At some point we did consider it, but we did not come [to] any conclusion,” Sisulu said. (David Harrison/M&G)

“There was an offer from Saudi to invest in Denel, not buy a stake. At some point we did consider it, but we did not come [to] any conclusion,” Sisulu said. (David Harrison/M&G)

Negotiations between South Africa and Saudi Arabia about investing in the struggling arms manufacturer, Denel, have fallen through, according to International Relations Minister Lindiwe Sisulu.

Saudi Arabian Military Industries was reported to be seeking to acquire a stake in the state-owned entity, which is on the brink of financial collapse.

South Africa has been criticised for seeking investment from Saudi Arabia in the face of human rights violations such as the murder of Washington Post journalist Jamal Khashoggi, allegedly by Saudi agents.

Sisulu told the Mail & Guardian no deal had been reached and Saudi’s “personal challenges” were a factor.

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“There was an offer from Saudi to invest in Denel, not buy a stake. At some point we did consider it, but we did not come [to] any conclusion,” Sisulu said.

“Soon thereafter Saudi [was] embroiled in something that was very personal to them and so those discussions did not proceed. So it would be out of context to be debating something that has not taken root or [been] formalised, or is not a possibility right now,” she added.

Denel has also attracted interest from the United Arab Emirates and Qatar, a bitter rival of Saudi Arabia.

Last month the M&G reported that government was uncomfortable with a meeting held between former president Jacob Zuma and the emir of Qatar, Sheikh Tamim bin Hamad Al Thani, in September.

READ MORE: Denel lands deep in Gulf crisis

The leaders are reported also to have met in 2017 to discuss Qatar buying a stake in Denel.

Sisulu denied reports she had tried to stop the meeting between Zuma and the emir.
“I read about it for the first time in the media,” Sisulu said. “I do know … president Zuma did go to Qatar as a private citizen and as far as I’m able to ascertain it had nothing to do with government responsibility nor […] with myself.”

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