The Mpati commission of inquiry into the affairs of the Public Investment Corporation (PIC) heard testimony this week from Ayo executive Malick Salie that appeared to directly contradict what businessman Iqbal Survé has previously told the inquiry about his own role in the listing of Ayo Technology Solutions.
Salie worked on the listing as an executive of African Equity Empowerment Investments (AEEI), a company indirectly controlled by Survé and which remains Ayo's largest shareholder.
"During the listing period the [AEEI] team had various interactions and meetings with Survé, who set the tone for the PLS [pre-listing statement - a document circulated to investors before a listing] and provided his expectation of the valuation of Ayo," said Salie.
Salie was appointed Ayo's chief investment officer earlier this year, a position which included being made an executive director of the company. Salie resigned his directorship earlier this month but remains an employee.
The controversial listing of Ayo in December 2017 saw the PIC pay R4.3bn for a 29% stake in Ayo. It was the only investor to buy shares at the listing, which has come under intense scrutiny at the inquiry given the price the PIC paid for the shares and the manner in which the investment was dealt with by the state-owned asset manager.
Salie's testimony also indicated that it was Survé who facilitated the introduction of the investment to the PIC, through his relationship with PIC CEO Dan Matjila. Salie described a conference call at which he was present in July 2017 in which Survé informed Matjila of the forthcoming listing.
"[Survé told Matjila] We have a road map for this listing and the team would come and discuss it [with the PIC] at a later stage. This took place around the end of July 2017," said Salie.
He went further and described how, at Survé's insistence, the valuation of Ayo rose from R5bn to somewhere between R10bn and R15bn following a high-level meeting that took place in July 2017 between Survé, Salie and Khalid Abdulla, the CEO of AEEI.
"At the meeting, Survé's recommendations were incorporated in the draft pre-listing statement and a valuation of R13bn was determined," said Salie.
The valuation would rise to R15bn the next month "based on Survé's input". Salie advanced no reasons why the valuation should be increased. The price the PIC ended up paying for its Ayo shares came very close to this revised amount.
Salie's description varies sharply from statements provided by Survé to the commission last month in which he stated: "The Ayo listing was led by AEEI Corporate Finance and its executive team and the executives of Ayo."
With respect to the subject of the engagement process with the PIC, Survé prefaced his comments with: "I am informed by the chairperson of Ayo and the CEO of AEEI that the engagement process with the PIC was as follows ."
If anything, the contrasting testimonies again highlight the relationship between Matjila and Survé, which could result in the latter being requested to reappear before the commission to clarify or correct his testimony.
The relationship is particularly relevant following testimony of the PIC's company secretary, Bongani Mathebula, who said that the subscription agreements for Ayo and another Survé-related listing, Sagarmatha Technologies, were both signed by Matjila in December 2017, on the eve of the ANC elective conference.
The PIC had done no due diligence on Sagarmatha and its investment team had not even heard of the proposed listing at this point.
Sagarmatha's listing, which would later be scheduled for June 2018, and which would see the PIC commit to investing billions of rands, was ultimately scuppered by the JSE.
Exactly why Matjila appeared to demonstrate such reckless behaviour by committing the savings of public servants to Sagarmatha without allowing the PIC to conduct an appraisal lends credence to the testimony of Salie's predecessor, Siphiwe Nodwele.
Testifying about the rush to list Ayo in December 2017, Nodwele stated: "I am aware from various internal discussions with Khalid Abdulla and Malick Salie that the clear rush to the initial listing date of 15 December 2017 was due to the impending ANC elective conference at Nasrec. There was an apprehension within the group, I imagine from Iqbal himself, that any changes to the leadership of the ANC would lead to changes in the PIC management and would thus remove whatever influence he had over the likes of Dr Matjila.
• Dan Matjila, who resigned from the PIC late last year, is still to testify before the commission...