Working with Bosasa was a severe oversight, but the money we received was not a bribe

I have never used my 'influence' in any business dealing, writes Andile

31 March 2019 - 00:05 By ANDILE RAMAPHOSA

In 2016, my company Blue Crane Capital had a vision of introducing smart-city solutions in key African centres. We needed a technology partner to supply the hardware and an implementing partner with strong operational capabilities. That's how we entered into a business relationship with African Global Operations (AGO), previously known as Bosasa.
This business relationship, which was the subject of testimony at the Zondo commission of inquiry earlier this week, has become a matter of public scrutiny and controversy. Correctly so, it must be scrutinised, and the facts must be laid bare for all to see and judge.
We had been working with Dahua Technologies, the world's second-largest original equipment manufacturer, as our technology partner for about a year, building solutions for the East African market. We built a pipeline that promised a turnkey solution to clients. It was time for us to deliver. We needed a strong implementation partner and, in that process, Dahua introduced us to AGO.
Dahua had already supplied them with equipment and had an established relationship. With Dahua's global standing and expertise we had no reason to doubt their recommendation of AGO. We did not evaluate AGO beyond their technical and operational capabilities, which were impressive.
In our enthusiasm and haste to press ahead with putting together a team to deliver on our offering and the pipeline of projects we were building, we overlooked the reputational and other risks posed by AGO and its past business practices. We did not take account of the reports that had surfaced over the years about allegations of wrongdoing. This is something I sincerely regret. It is a massive letdown for me personally and for my company.
Following several months of preparations, we signed an advisory mandate with AGO in December 2017, which provided for a monthly retainer. In January of 2018 we went further and signed an anti-bribery and corruption policy with all our partners, including AGO.
Over the year or so that the contract was in operation, Blue Crane Capital received a total of around R2m from AGO. Following revelations about AGO's alleged business practices, we terminated the contract.
The payments received were for work done in East Africa. Our retainer kicked in as we incurred costs for the commencement of the projects. We employ a team of 12 people in Uganda. The work carried out to date includes a solar-power installation for a large oil multinational in support of their service stations in Uganda. We have also rolled out a fibre network for eight financial services companies, including multinational banks.
The money was not a gift, bribe or a favour. Work has been done and continues to be performed, albeit in a limited capacity.
We have an active pipeline of projects that are suffering as a result of the AGO termination. We are working diligently to recover those losses and deliver to the mandates we have secured.
Blue Crane Capital invoiced AGO in final settlement for amounts owing as agreed in the termination letter that was issued in November 2018. We did not seek any further payments from AGO after we terminated the contract.
I have not partnered with AGO for any work in SA. Blue Crane Capital had put together a compelling offering for the benefit of cities in East Africa. In this regard, there was no influence to be exercised.
I have never embarked on a partnership with AGO or any others with corrupt intentions or a desire to subvert the law or due process for monetary benefit. I look forward to a time when law enforcement agencies and prosecutorial authorities act quickly on serious allegations when they surface.
I am not above the law, nor am I deserving of any special privileges in being subjected to any form of investigation. I am prepared to fully co-operate with any investigation to be carried out by SA's statutory bodies or prosecutorial authorities. I have already availed myself in assisting the public protector's office in its inquiry.
I have never used my "influence" in any business dealing. I have never offered to use my "influence" to assist AGO or any other company to secure tenders, nor have I ever been in a position to do so. My company, Blue Crane Capital, has never conducted any business with the government or state-owned entities and has never entered into an obviously conflicted business arrangement within any section of the South African or any other government.
It is public knowledge that Gavin Watson, the CEO of AGO, made a donation of R500,000 to the so-called CR17 campaign, which was supporting the movement for my father, Cyril Ramaphosa, to be elected ANC president. That donation was sought directly from Mr Watson by the CR17 campaign team. It was distinct from, and unrelated to, the contract that my company had with AGO.
I have learnt a hard lesson from the errors of our weak due diligence processes. The partnership with AGO was a severe oversight. Since terminating the relationship with AGO on the basis that they were in breach of our anti-corruption and bribery policy, we have worked hard on improving our due diligence framework, including through the engagement of third-party risk assessors. We will continue to enhance our risk-assessment methods as our business recovers.
Going forward, I am working extremely hard to refocus our business. I am grateful to our staff and partners who have remained supportive during this difficult period. I accept that by going into business with AGO, I committed a grave error of judgment. But there was nothing corrupt about the relationship. That is not the way I conduct my business, or ever will.
• Ramaphosa is founder and MD of Blue Crane Capital

This article is reserved for Sunday Times subscribers.

A subscription gives you full digital access to all Sunday Times content.

Already subscribed? Simply sign in below.

Registered on the BusinessLIVE, Business Day or Financial Mail websites? Sign in with the same details.

Questions or problems? Email helpdesk@timeslive.co.za or call 0860 52 52 00.