SAA-BnP cancellation a ruse to enrich Myeni’s cronies
24 July 2016
It should come as no surprise that the Chairperson of SAA, Ms. Dudu Myeni, is incapable of doing what is right and what is in fact best for the airline. Now we know from today’s Sunday Times, that the cancellation of the BnP contract was just a charade by the SAA board chair and board in an attempt to look good, whilst in the background Myeni and her cronies were planning to pay R 49.9 million to BnP for doing nothing.
The directors, led by Ms Dudu Myeni, are not only recklessly allowing SAA to continue to trade at a loss and apparently knowing that the entity is “financially distressed” as defined in the Companies Act but they are participating in the looting of a further R 49.9 million from SAA and thus from service delivery that is so desperately needed.
It is increasingly clear that without further cash injections SAA will not be able to pay its debts as they become due in the ordinary course of business. Despite this Myeni is apparently making every effort to ensure that an amount of R49.9 million is added to the loss that SAA is undoubtedly going to report for the 2016/17 financial year. By approving the payment of R 49.9 million to BnP the SAA board directors are arrogantly adding to their actions in breach of the following sections of the Act:
s76 (2)(a)(ii) in that they have knowingly caused harm to the company.
s76 (3)(b) in that they have not exercised the powers and performed the functions of director in the best interests of the company.
s129 (1) in that there have been no proceedings for liquidation initiated and the directors have not resolved that the Company voluntarily begin business rescue proceedings and consequently also in breach of sect. 129 (7) as the board has not delivered a written notice to each affected person setting out the criteria as per s128 (1)(f) that are applicable to SAA and the board’s reasons for not resolving as contemplated in that section.
S77 (3) of the Act will apply to the directors of SAA and stipulates that a director of a company is liable for any loss, damages or costs sustained by the company as a direct or indirect consequence of the director having acquiesced in carrying on the company’s business despite knowing that it was being conducted in a manner prohibited by s22(1).
Despite all the shenanigans Dudu Myeni and her board sail along, relentlessly continuing to trade recklessly and therefore in breach of various sections of the Companies Act. The Minister of Finance, Pravin Gordhan, is clearly powerless, in the face of protection provided to Ms Myeni by President Zuma, to take the very urgent steps to put SAA under Business Rescue.
The Democratic Alliance reiterates the urgency for SAA to be placed under business rescue.
Statement issued by Alf Lees MP, DA Deputy Shadow Minister of Finance, 24 July 2016
