Court bid to oust Myeni from SAA

04 September 2016 - 02:03 By JAN-JAN JOUBERT, STEPHAN HOFSTATTER, SABELO SKITI and MZILIKAZI wa AFRIKA
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SAA chairwoman Dudu Myeni.
SAA chairwoman Dudu Myeni.
Image: Veli Nhlapo

Mmusi Maimane is expected to announce on Monday that the DA will go to court to declare SAA chairwoman Dudu Myeni's re-appointment to the position as invalid and against the law.

The DA leader is scheduled to make the announcement in Parliament.

DA federal executive chairman James Selfe said yesterday the party was taking final legal advice and that it planned to file papers in the High Court in Cape Town on Wednesday.

Selfe confirmed the DA will ask that the case be placed on the urgent roll.

"We will be arguing that Ms Myeni is an inappropriate and incapable appointment," said Selfe.

During Myeni's tenure, he said, the SAA board had:

• Failed to publish annual financial statements for 2014-15 with an apparent loss of R4.7-billion;

• Failed to publish annual financial statements for 2015-16 with an apparent loss of R4-billion;

• Apparently ran SAA at a R1.3-billion loss for the first quarter of the 2016-17 period;

• "Irrationally" suspended officials, apparently because they tried to curb corruption at the airline;

• Put SAA at risk of losing lucrative routes, such as the Hong Kong route.

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"The announcement by cabinet to re-appoint Ms Myeni undermines the principle of appointing the brightest and the best to serve the state and its entities. Cabinet, which only does the bidding of President Jacob Zuma, continues to make wrong decisions - Ms Myeni's re-appointment being one of many," said Selfe.

The Sunday Times has also learnt that Myeni was not on the National Treasury's list of preferred candidates for the SAA board.

Sources told the Sunday Times that a list of 13 candidates Finance Minister Pravin Gordhan drew up last week did not contain Myeni's name.

The final list of 12 board members released by the cabinet on Friday had 11 of the original 13 candidates, but added Myeni.

Myeni, who is known to be close to Zuma, has presided over the economic meltdown of the state airline and the decimation of top talent by initiating a slew of suspect deals.

These include wanting to pay unregistered "boutique" financier BnP Capital a R256-million success fee to raise debt funding, against the advice of SAA's own treasurer.

There has been widespread speculation that Myeni's name was added to the list at the 11th hour as part of a compromise between Zuma and Gordhan.

Bongani Ngqulunga, spokesman for the Presidency, denied this.

Part of the compromise around re-appointing Myeni was that she would serve for only one year instead of seeing out the remaining two years of her three-year term.

Sources said that Gordhan's inclusion of Tryphosa Ramano, a former chief financial officer at SAA who is a chartered accountant and considered a strong personality, would serve to keep Myeni in check.

Ramano, who is chief financial officer at PPC Cement, worked at SAA as chief financial officer between 2004 and 2006, and was part of the exodus of executives under Khaya Ngqula's term as CEO.

Lawyer Peter Tshisevhe is another corporate appointee.

His name appeared in documents for an unsuccessful and controversial jet fuel deal, into which Myeni attempted to insert a company belonging to Sizwe Zuma, who is said to have links to the president.

But the deal never materialised.

Tshisevhe said this week he had simply represented his client in the proposed deal and felt no need to declare it.

Appointing a new board is a crucial step in avoiding the total collapse of SAA.

The airline's financial statements cannot be issued on a going-concern basis until it gets a government guarantee from the Treasury.

block_quotes_start Sylvain Bosc, SAA's chief commercial officer, has been forced to stay home - on full pay - despite a disciplinary ruling in his favour in July block_quotes_end

Over the last two weeks, SAA and the Treasury have battled to avert a crisis after Hong Kong authorities threatened to revoke the airline's licence to operate there if it fails to submit audited financials before September 30.

Banks, creditors and other service providers have also been jittery about the lack of financials. The Treasury did not budge on the guarantee, citing the need for a functional board to be put in place first.

The airline is expected to report massive losses when it finally releases its financial statements for the years ending 2015 and 2016.

In previous interviews conducted this year, Myeni said the airline had halved losses from around R4-billion in 2015 to under R2-billion.

SAA spokesman Tlali Tlali said yesterday that any delay in tabling the airline's financial statements "could simply be devastating for both the airline and the country".

"We are optimistic we will be able to do so on a date determined by the shareholder," said Tlali.

Sources at SAA and the government said that Musa Zwane and Phumeza Nhantsi, acting CEO and acting chief financial officer respectively, had been told the new board would lead new processes to find permanent appointees.

It has also emerged that Sylvain Bosc, SAA's chief commercial officer, has been forced to stay home - on full pay - despite a disciplinary ruling in his favour in July.

The ruling, which has been seen by the Sunday Times, clears him of all charges but is critical of SAA, including former board member Yakhe Kwinana, who jumped ship last week.

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Kwinana was Myeni's closest confidante on the board and headed the airline's audit committee until she quit unexpectedly.

Last year Bosc was charged with misconduct for allegedly presenting the board with a misleading business case for a new Johannesburg to Abu Dhabi route.

He was suspended on full pay on October 2 last year.

SAA insiders said the real reason for his suspension was that he clashed with Myeni and Kwinana over key decisions.

Witnesses at Bosc's disciplinary hearing said his work was exemplary and the Abu Dhabi business case was sound.

However, Kwinana told the hearing that Bosc would be fired even if he was cleared of all the charges against him.

Bosc, whose version of events was deemed by the ruling to "carry more weight than that of the employer", said this showed the case against him was a "witch-hunt".

Kwinana said she had no control over whether he returned to work, but accused Bosc of having ignored advice "and got the board to approve a route that would never make profits".

It is understood that Bosc asked to return to work after the ruling, but has yet to receive a reply.

Bosc would not comment on the ruling this week.

"The matter is in the hands of my lawyers," he said. "I cannot comment any further."

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