BNP Capital director Daniel Mahlangu has told the State Capture Commission he did not know his company flouted tender regulations and was working with former SAA chairperson Dudu Myeni’s adviser when it won an SAA tender to provide financial advice and later source R15-billion.

BNP Capital established a joint venture with Masotsha Mngadi’s In Line Trading in 2016 and won a tender to advise SAA on debt relief funding. Without going to tender, the deal was later expanded for BNP to source R15-billion for the airline.

BNP wanted to charge R2.6-million for its first deal and was set to make R256-million for raising the R15-billion for the cash-strapped airline, around R30-million more than BNP had quoted for its work.

Testifying at the commission on Thursday and Friday, Mahlangu claimed he did not know Mngadi was Myeni’s personal adviser or that he worked at Nedbank at the time. Mngadi handled all communication with SAA, and Mahlangu never met any of the airline’s officials.

This is despite Mngadi requesting all references to himself be removed from BNP and In Line’s tender bid at the last minute. The consortium won the bid in February 2016 despite failing to provide the required BBBEE certificate, a pricing schedule, or documents related to its joint venture.

The bid said In Line’s Brandon King would play a senior role but King had already resigned from the company.

“We realised that actually there were bigger protagonists at play and we find ourselves sort of in between being scapegoats for some of them,” said Mahlangu, finishing his testimony on Friday.

Former acting SAA CFO Phumeza Nhantsi has testified that Myeni told her Mngadi was her personal adviser. He drafted correspondence with SAA on behalf of BNP and even added Mahlangu’s digital signature. Mahlangu said he would check “some, not all of them” before the correspondence was sent.

“We just assumed whatever he was bringing to the party was the gospel of truth,” said Mahlangu, claiming to trust Mngadi because he brought the business opportunity to BNP’s attention.

Evidence leaders questioned Mahlangu on his company’s failure to inform SAA that its licence had been suspended by the Financial Services Board (FSB) and the cancellation fee it tried to charge the airline.

Mahlangu claimed BNP informed SAA its licence had been suspended in May 2016 but Nhantsi testified that she was not notified. A July 2016 letter from BNP did not mention its licence had been suspended.

BNP would not have been awarded its lucrative contract extension had SAA have known about the suspension, Mahlangu admitted.

SAA cancelled BNP’s contract after the deal became public and civic organisation Outa launched a legal campaign, but Myeni is said to have pressured Nhantsi and the board to pay the company a cancellation fee of R49.9-million, which only she voted for.

Mahlangu denied that BNP’s contracts included a cancellation fee or that he had pressured SAA to pay. He said BNP was only entitled to a cancellation fee if it had finished sourcing the R15-billion and SAA decided not to utilise it. Evidence leaders however detailed the contracts, which suggested that BNP had successfully negotiated a sweetheart deal if its services were terminated.

Despite blaming Mngadi for bypassing BNP to communicate with SAA, Mahlangu met his former business partner in 2017 and signed an affidavit he said was meant to put the record straight. His affidavit, however, failed to mention Mngadi’s role in the joint venture or that he requested not to be named in official documents.

Former SAA treasurer Cynthia Stimpel told the commission BNP’s contract was awarded for work already completed by her department.

Mahlangu on Friday alleged that Stimpel wanted to limit SAA’s finance deals to the country’s large, established banks.

“The big banks had basically captured SAA,” he said before chairperson Deputy Chief Justice Raymond Zondo cut him off.

The commission continues. DM