Transnet has hired Werksmans Attorneys to help its board probe allegations of corruption linked to a 2014 programme to buy more than 1,000 locomotives.
The investigation will include a review of whether the state-owned company was overcharged for locomotives, whether the firm followed its own procedures and examine comparable pricing, CEO Siyabonga Gama told reporters on Monday. The process will take about three months, he said.
The amaBhungane Centre for Investigative Journalism and Scorpio, the Daily Maverick news website’s investigative unit, reported in June that the Gupta family, who are friends with President Jacob Zuma and in business with his son, entered into a R5.3bn of kickback agreements with a unit of China South Rail, which was selected to supply 359 of Transnet’s 1,064 new locomotives.
The story cited leaked e-mails. Bloomberg has not been able to independently verify the information and a spokesman for the Guptas did not respond to questions at the time.
The report formed part of a broader series of stories based on the e-mails leaked to local news media, as well as reports by the country’s main church organisation and a team of eight academics placing Zuma and the Guptas at the centre of an orchestrated effort to raid state assets.
The bidders that won the locomotive orders, which also included General Electric and Canada’s Bombardier, offered the lowest prices, Gama said in an interview after presenting Transnet’s annual financial results.
The Johannesburg-based company would not be privy to any agreements between its suppliers and third parties, he said.
"But because there’s been these ongoing allegations, as soon as the board saw this they said ‘let’s probe it, let’s see if our processes are correct’," Gama said.
Transnet reported a six-fold increase in annual profit to R2.8bn and said rail volumes gained 2.3% from a year earlier, boosted by a rise in general freight activity.