Zwelakhe Ntshepe. Picture: BUSINESS DAY
Zwelakhe Ntshepe. Picture: BUSINESS DAY

Denel group CEO Zwelakhe Ntshepe has resigned after a six-month stint in which the utility’s financial and operating performance took a nosedive.

The situation at Denel under his stewardship was so dire that the company could not pay its suppliers and staff salaries. The newly appointed interim board is said to have made it clear that it had lost confidence in his ability to manage the ailing state-owned arms manufacturer.

Ntshepe and former Denel board chairman Daniel Mantsha were implicated in allegations of state capture in a tranche of leaked Gupta e-mails. Mantsha resigned from Denel in March.

Ntshepe’s resignation comes a month after disclosures that Denel had given North West premier Supra Mahumapelo’s son a questionable R1.1m bursary to become a pilot.

According to Rapport newspaper, Ntshepe personally signed the contract.

Denel announced on Tuesday that Ntshepe had resigned, citing “personal” reasons. He did not respond to requests for comment. His resignation was with immediate effect.

He has been at the company for 20 years but was only in the position of group CEO for six months, following a two-year acting period.

Business Day understands that the new board of directors, appointed a month ago, had made it clear to Ntshepe that he was part of the deterioration at Denel. The board had also highlighted the lack of accountability by Denel’s executive management to steer the company from the predicament it was in.

On Tuesday, Denel said that management — supported by the board and shareholders, including Treasury — was working on resolving the liquidity challenges.

Business Day understands the board had been inundated with complaints from suppliers about nonpayment by the entity.