Dudu Myeni says she was working in SAA’s best interests
The former SAA chair is accused of being responsible for the failure of a R1.5bn profit guarantee, and being a Zuma lackey
Former SAA chair Dudu Myeni has spent hours denying damning allegations against her, saying she was working in the airline’s best interest in trying to turn it around, and that she was not recommended for the post by former president Jacob Zuma.
She was taken to the high court in Pretoria by civil rights group Organisation Undoing Tax Abuse (Outa) for alleged misconduct during her time running the airline.
The purpose of the case is to have Myeni declared a delinquent director in terms of the Companies Act. If so declared, it would mean she could never secure work as a director at any entity.
While the case was initially set to start in October, Myeni delayed proceedings when she did not arrive, saying she did not have money to travel from KwaZulu-Natal to Pretoria.
Key among the allegations are claims that she was responsible for the failure of a R1.5bn profit guarantee for the airline if it went ahead with a deal with airline Emirates in June 2015.
SAA executives, including former acting CEO Nico Bezuidenhout, former commercial director Sylvain Bosc, former financial officer Wolf Meyer, and former CEO Thuli Mpshe, have testified in the case. Evidence was led that the deal may have helped uplift the airline.
Ending Airbus deal
Myeni is also accused of putting an end to a multi-billion-rand transaction with Airbus to secure five aircraft that SAA would have used for international routes. The court was told that former finance minister Nhlanhla Nene had approved the deal in 2015, but that Myeni wanted to use a company of her choice to conclude the deal.
Reports from earlier this month said Myeni allegedly sent a fake letter to Airbus, stalling the deal that could have saved the airline R2bn a year.
Her lawyer, Nqabayethu Buthelezi, previously argued there was no case against his client, saying she would take the stand on Thursday to clear her name.
Dudu Myeni was taken to court by civil rights group Organisation Undoing Tax Abuse for alleged misconduct during her time at SAA. She appeared at the Palace of Justice in Pretoria on February 20 2020. The aim of the case is to have Myeni declared a delinquent director in terms of the Companies Act.
First among the questions asked was whether she had been recommended for the position of chair by Zuma, which she denied. “It’s not true, it’s an allegation,” she said.
Regarding the Emirates deal, she read from an SAA comprehensive network and route plan that was approved by the board. The report, written by an independent firm, recommended that if SAA wished to expand and use the Johannesburg/Dubai route, it would require government intervention. Not for financial support, said Myeni, but rather that they limit the amount of flights on that route that Emirates would be allowed to undertake.
Buthelezi then asked Myeni if she accepts that she was responsible for destroying the relationship with Emirates and costing the company billions. However, Outa representative Carol Steinberg said this was not the allegation as Emirates continued to work with SAA, meaning the relationship was stable, but that Myeni had been responsible for the loss of the R1.5bn deal.
Myeni again denied she was responsible for the breakdown, saying she is glad to be before the court to explain what really happened.
She presented a 2015 e-mail between herself and some of the top executives, including Bosc, asking why SAA had allowed Emirates to increase its flight frequencies in SA, yet still complained that its own business was shrinking. She said she would not allow foreign carriers to enjoy more flights in airports across the country “at the expense of SAA”.
Myeni said she never received a response to this e-mail, which contained a memorandum of understanding (MOU) regarding how Emirates would continue to operate in SA. She asked that the MOU be reviewed to ensure that business would not be taken away from SAA by allowing Emirates further flight frequencies.
She said in the same e-mail that she did not enjoy talking directly with the executive leadership, as this was not part of her mandate as board chair and she therefore denied allegations made during the trial that she was known for making direct orders to the executive team at SAA.
Myeni said that the Treasury had been brought in to analyse the deals between Emirates and SAA. However, by the end of May 2015, the executives had sent through a proposed MOU for the R1.5bn deal, asking for the board’s approval. Myeni said it was not simply for the board to rubber stamp such deals and that the board had to apply its mind to decide if it would approve the deal.
While Myeni promised she would give word on the deal by June 9 that year, she said she was still waiting for a review team to present a different version of the MOU that would favour SAA’s business. However, by June 16 she was unable to get the board together for a sitting to hear the new plan. By that date, Myeni confirmed she had received a call from Zuma asking why the deal had not gone ahead. She then called Bezuidenhout, as acting CEO, to ask why this had happened.
The case continues.