Former Public Investment Corporation (PIC) chief executive Dan Matjila has accused former PIC colleagues, who have pointed fingers at him for alleged governance failures at the state-owned asset manager, of doing so for their own “self preservation”.
Key witnesses, including now suspended PIC acting chief executive Matshepo More, have testified before the Mpati commission on suspicious transactions between the PIC and several companies including in the Sekunjalo Group, namely Ayo Technology, Independent Media and Sagarmatha. Witnesses have also testified about other flagged transactions with SA Home Loans and the now defunct VBS Mutual Bank.
The commission — which began public hearings in January and is chaired by Judge Lex Mpati — was appointed by President Cyril Ramaphosa in October 2018 to probe alleged impropriety at the PIC. Ramaphosa had initially given the commission until April 15 to conclude its work and to submit a report, but the president has since extended the deadline to the end of October.
On Monday, Matjila continued detailing the circumstances that led to the PIC’s R4.3-billion investment in Ayo Technology in 2017— a deal that had been flagged by suspended PIC assistant portfolio manager, Victor Seanie as a foregone conclusion before any due diligence was conducted.
The PIC paid an inflated fee of R43 per share for a 29% stake in the company linked to controversial businessperson Iqbal Survé, two years ago prior to its listing on the JSE. Ayo’s shares have plunged to R9 since the signing of the deal, meaning that the PIC’s investment has lost R3-billion in value.
Matjila told the commission he believes that the PIC’s investment in Ayo is still positive because the “R4.3-billion is still there and earning interest”.
The former chief executive said that the valuation of Ayo’s shares had been recommended by his team of “professionals” at the PIC and that he approved of the deal because he trusted their expertise.
“I’m just a CEO and I’m taking advice from the technical experts that were saying that this transaction [ Ayo] is worthy to be pursued. It’s in the reports that’s what they told me,” Matjila pleaded.
Quizzed by the commission’s assistant, Emmanuel Lediga on whether he did not notice any discrepancies in Ayo’s expected earnings which showed an expected R1-billion profit in 2019, Matjila said that the massive profits did not ring any bells because he was taking advice from his team that the transaction was legitimate.
“My professionals were happy, they said that this can be done,” Matjila said.
I’ve been in this industry for a long time and I’ve never seen such blue skies being accepted,” Lediga continued.
“That’s what I was advised,” Matjila said.
A visibly agitated Matjila continued to pour cold water on Seanie’s testimony in March before the commission that Matjila had overlooked governance and approval processes ahead of the deal despite concerns raised by the employees at the PIC.
“I didn’t understand the behaviour of my former colleagues. It shocked me actually, when they appeared before the commission saying that they were being forced to do things when they had written memos on this transactions saying that they are in support of this transaction,” he said.
The inquiry continues.