/ 15 July 2019

Matjila grilled on merger between KiliCap and Sakhumnotho at PIC commission

Former PIC CEO Dan Matjila.
Former PIC CEO Dan Matjila. (David Harrison/M&G)



Dan Matjila faced tough questions regarding the role he allegedly played in ensuring Kilimanjaro Capital (KiliCap) and Sakhumnotho Holdings formed a consortium to secure a 25% stake in Total SA.

On Monday, the former Public Investment Corporation (PIC) chief executive appeared for his fifth day of testimony before the commission — chaired by Justice Lex Mpati — looking into alleged impropriety at the state asset manager.

Matjila again denied that he played a central role in the formation of KISACO, a merger between KiliCap and Sakhunotho, for the company to receive PIC funding for a R1.8-billion stake in the global energy company.

The PIC funded the deal in 2015.

Last week, Matjila told the commission that he introduced the director of KiliCap, Lawrence Mulaudzi to Sipho Mseleku, who was the Sakhumnotho chairperson, at the PIC offices.

READ MORE: Matjila: Mulaudzi misled PIC commission on KiliCap, Sakhumnotho merger

However, Matjila refuted Mulaudzi’s previous testimony before the Mpati commission that he brokered a merger between the two companies, saying that the two voluntarily agreed to the deal.

“Without the merger both companies stood a real risk of losing the bid as they were both small,” he said.

Matjila admitted that he preferred that both parties merge: “The merger greatly increased the newly merged company’s prospects of success in being awarded the tender and that is why Mulaudzi agreed to the merger.”

Evidence leader advocate Issac Monnahela presented an email to the commission which allegedly proved that Matjila knew about Sakhumnotho’s interest in the deal on 1 June 2015.

Matjila had previously testified that he was unaware of Sakhumnotho’s interest in the deal and only knew of KiliCap as the preferred bidder. KiliCap received a non-binding letter of expression of interest from the PIC on 2 June 2015.

The email, which was read out loud by Monahela, showed that Matjila’s executive assistant, Wellingnton Masekeza received correspondence from Mulaudzi requesting a letter of support from the former CEO. Masekeza then forwarded the email to Matjila who responded that there was “another BEE” interested in the deal adding that “we may have to persuade them to work together.”

Asked by Monahela which other “BEE” he was referring to in the email, Matjila said he could not recall as there were two other companies in the bidding process apart from KiliCap, namely Lereko and Sakhumnotho.

“What did you mean when you said we may have to persuade them to work together because you have denied before this commission forcing KiliCap to merge with Sakhumnotho?” Monahela asked.

“This is just a suggestion that we may have to persuade them and I still stand by my word that no one was forced at the time when they were seeking bidding letters of interest,” Matjila responded.

The commission’s assistant, Gill Marcus, again questioned Matjila on the coincidence of both Mulaudzi and Mseleku being at the PIC’s offices at the same time for a meeting with Matjila regarding the deal.

“There is a lot of questions about what is the intent and what is understood by having that meeting. There is always an inevitable outcome,” Marcus said.

“It does raise the question of what records are kept when one deals with these kinds of issues because there should not be a matter of uncertainty when you’re looking back on a decision that involves nearly R2-billion,” she added.

“No comment,” Matjila responded, saying that he had already provided an explanation on the matter.

The inquiry continues.