A letter written by the boss of the Passenger Rail Agency (Prasa) in 2012 sets out\u00a0extraordinary detail of how the Gupta family and President Jacob Zuma\u2019s son allegedly\u00a0schemed to capture the parastatal and profit from a R51-billion tender.<\/p>\n
The Guptas, the letter says, represented China South Rail (CSR), one of seven bidders then\u00a0vying to supply Prasa with 600 commuter trains. Such representatives often earn huge\u00a0success fees.<\/p>\n
In \u201cnumerous meetings\u201d the Guptas, Duduzane Zuma and their associates allegedly\u00a0pressured then transport minister Ben Martins and Prasa\u2019s then CEO, Lucky Montana, to\u00a0favour CSR.<\/p>\n
They also, the letter claims, proposed allocating \u201cshares\u201d to Montana and \u201cdirectly,\u00a0unashamedly and unapologetically demanded\u201d that Martins restructure Prasa\u2019s board.<\/p>\n
Montana wrote the letter to then Prasa board chair Sifiso Buthelezi after discovering that\u00a0the transport department was preparing a Cabinet memorandum to rejig the board.<\/p>\n
Montana proposed that \u201cI negotiate my exit\u201d from Prasa, saying: \u201cI feel betrayed, in spite of\u00a0having \u2026 been given assurances by our honourable minister that the restructuring of the\u00a0Prasa board was not on the cards.\u201d<\/p>\n
His threat to quit led to further reassurances from Martins and the board remained\u00a0unchanged. Another bidder, France-backed Gibela, was handed the R51-billion tender about\u00a0a month later, in December 2012.<\/p>\n
However, CSR went from strength to strength at another parastatal, Transnet. There, CSR\u00a0consortia won tenders to supply 95 locomotives in 2012 and the largest share of 1\u00a0064\u00a0locomotives worth R50-billion split between four bidders in 2014. It is not known if the\u00a0Guptas represented CSR in these bids.<\/p>\n
“<\/em><\/strong>I had taken issue with the representative of the Gupta family\u00a0…\u00a0“<\/em><\/strong><\/p>\n Montana this week confirmed writing the letter, an unsigned version of which the\u00a0amaBhungane Centre for Investigative Journalism obtained. Buthelezi, who did not want to\u00a0comment on the details, confirmed receiving it. A source close to Martins confirmed the\u00a0essence of the letter\u2019s contents in so far as they relate to him.<\/p>\n The revelations \u2013 an unprecedented inside view of how the president\u2019s friends allegedly\u00a0parlay political access into commercial gain \u2013 may reopen the wound of ANC secretary\u00a0general Gwede Mantashe\u2019s failed probe into Gupta \u201cstate capture\u201d.<\/p>\n The ANC closed the investigation last month after receiving only one written statement.<\/p>\n Montana, who was ousted from Prasa last year over unrelated corruption allegations, said\u00a0he would \u201cleave for today\u201d why he did not submit a statement.<\/p>\n The story of the letter starts in September 2012, three months after Jacob Zuma appointed\u00a0Martins as transport minister and two months after Prasa issued the train tender. Bids were\u00a0due by September 30.<\/p>\n \u201cI have previously reported to the chairman\u201d, Montana wrote, \u201cof my attendance of\u00a0numerous meetings at various periods with the minister of transport, key advisors in the\u00a0ministry of transport and representatives of the Gupta family.<\/p>\n \u201cIt is in these meetings where I was introduced to representatives of the Gupta family and\u00a0the son to the president, Mr Duduzane Zuma, and their relationship with one of the bidding\u00a0companies, China South Railways\u2026<\/p>\n \u201cI had taken issue with the representative of the Gupta family over what I considered to be\u00a0attempts on their part to \u2018extort\u2019 money from [the bidders].\u201d<\/p>\n “<\/em><\/strong>This will ensure that the requirements of the Gupta family … “<\/em><\/strong><\/p>\n Montana this week said he was called to a first meeting at Martins\u2019 Pretoria residence as he\u00a0was about to depart for a transport conference\u00a0during the third week of September in\u00a0Germany. There, he was introduced to Rajesh \u201cTony\u201d Gupta, Duduzane Zuma and an\u00a0associate. They indicated their general interest in the tender.<\/p>\n Montana\u2019s letter says that at the conference, bidders approached him to say \u201cthat they are\u00a0required to pay money on the side, that they are aware that the Prasa AGM will be\u00a0postponed, which truly materialised, and further informed that [the] purpose of the\u00a0postponement was to allow time for the board of Prasa to be restructured.<\/p>\n \u201cThis will ensure that the requirements of the Gupta family and China South Railways are\u00a0achieved.\u201d<\/p>\n Montana this week said the bidders told him that a Gupta associate had met with bidders in\u00a0Switzerland, telling them: \u201cWe work with Lucky [Montana], we work with Ben Martins [and\u00a0we have] the support of the president. [If] you don\u2019t work with us, you are not going to get\u00a0this bid.\u201d<\/p>\n Montana said he asked for a meeting at the minister\u2019s house on his return, where he\u00a0\u201cblasted\u201d Tony Gupta and Duduzane Zuma. And he told them the correct route was for CSR – whom they said they now formally represented \u2013 to \u201csubmit a compliant bid\u201d.<\/p>\n \u201cI thought that was the end of the matter. Unfortunately it was not.\u201d<\/p>\n Restructuring attempts<\/em><\/strong><\/p>\n Before the adjudication, Tony Gupta wanted Montana to include two Gupta nominees\u00a0among the bid evaluators. Their CVs were delivered by a driver. \u201cI rejected that.\u201d<\/p>\n And the letter claims: \u201cI must also add that the Guptas have presented a plan that I and\u00a0other people have been allocated shares within CSR, the plan which I rejected\u00a0contemptuously in the presence of our minister.\u201d<\/p>\n And then there were the restructuring attempts.<\/p>\n The letter refers to a Gupta associate\u2019s alleged direct demand to Martins to restructure the\u00a0board. \u201cI was taken aback and continue to be surprised by the fact that the representative of\u00a0the said family finds such power, authority and audacity.\u201d<\/p>\n On October 28, the letter says, then transport director general George Mahlalela showed\u00a0Montana \u201ca written memorandum for the appointment of a new chairperson and other Prasa\u00a0directors [that] was being processed for submission to the cabinet\u201d.<\/p>\n AmaBhungane has confirmed the essence of this allegation with two sources who requested\u00a0anonimity but were close to the events.<\/p>\n The next day, the letter says, Montana met a Gupta associate who \u201creported that there is\u00a0agreement at political level that Prasa shall be instructed to cancel the [tender if it is] not\u00a0awarded to CSR or any one of the other two Chinese bidders. The restructuring of the board\u00a0of Prasa is intended to achieve this stated objective\u2026<\/p>\n \u201cI had made it clear that the procurement process for the new trains will run its full course\u00a0based on the principles required by our constitution and the law.\u201d<\/p>\n “… the biggest test came”<\/strong><\/em><\/p>\n Montana said that after he wrote the letter, he and Buthelezi met Martins, who supported\u00a0them – including when \u201cthe biggest test came\u201d, to get Gibela\u2019s victory through cabinet.<\/p>\n CSR South Africa representative Wang Pan this week responded to questions:\u00a0\u201cUnfortunately, I do not know what you are talking about. I also do not know the people you\u00a0referred in your story and have never met with them.\u201d<\/p>\n Duduzane Zuma did not answer calls or respond to text and email messages.<\/p>\n Gupta lawyer Gert van der Merwe said: \u201cDespite my repeated requests to be furnished with\u00a0a copy [of the letter] in order to respond thereto you refused. Your reasons for refusal are\u00a0insufficient and ill considered. As a result thereof I advise my clients to reserve their right to\u00a0comment until you disclose a copy of the document.\u201d<\/p>\n Van der Merwe was supplied with the text of the letter but not a scanned copy, given source\u00a0protection concerns. –\u00a0 Additional reporting by Craig McKune<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" A former Prasa CEO reveals how a bid by the Guptas and Duduzane Zuma was stopped.<\/p>\n","protected":false},"author":3,"featured_media":22513,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[],"class_list":["post-4554","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stories"],"acf":[],"_links":{"self":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4554","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/comments?post=4554"}],"version-history":[{"count":1,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4554\/revisions"}],"predecessor-version":[{"id":30729,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/4554\/revisions\/30729"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media\/22513"}],"wp:attachment":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media?parent=4554"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/categories?post=4554"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/tags?post=4554"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}