Publication: Mail and Guardian Issued: Date: 2001-03-30 Reporter: Evidence Wa Ka Ngobeni Editor:

Benz Man Won Arms Bid

Publication  Mail & Guardian
Date 2001-03-30
Reporter Evidence Wa Ka Ngobeni
Web Link

 DaimlerChrysler SA's key accounts man has a stake in the government's arms deal 

A top official at DaimlerChrysler South Africa, the company embroiled in the saga involving African National Congress chief whip Tony Yengeni’s luxurious car, is linked to a joint venture that was awarded a R220-million contract as part of the government’s controversial arms deal.  

Fanyana Shiburi, who is a divisional manager for key accounts at DaimlerChrysler, is also a director of the black empowerment company, Kgorong Investment Holdings, which through a joint venture with European Aeronautic Defence and Space Company (Eads) has secured the R220-million radar contract. Eads was formerly known as DaimlerChrysler Aerospace (Dasa).  

Eads came in to the spotlight last week after it emerged that Yengeni had landed the Mercedes Benz ML320 4x4 three days after Eads received it from DaimlerChrysler South Africa. Shiburi handles, among other things, fleet orders from the government and state-owned enterprises at DaimlerChrysler SA. A sister operation in South Africa, DaimlerChrysler Finance Services, started funding Yengeni’s car seven months after he received it from Dasa after rumours that Yengeni had received the car as a gift. Yengeni formerly chaired Parliament’s defence committee.  

It is unclear whether Shiburi had any influence over the provision of finance for Yengeni’s car. Shiburi denies that he was instrumental in securing the car finance. Eads and Kgorong each have a one-third stake in Reutech Radar Systems (RRS), the company that won the radar bid. The other shareholder in RRS is Reunert.  

Shiburi joined DaimlerChrysler in 1997. He previously worked in the public relations and marketing department of the National Soccer League (now Professional Soccer League). Formed in 1998, Kgorong features leading figures with strong government links, including Danisa Baloi, chair of the Gauteng Tender Board and deputy chair of the state-owned arms company Denel. Sello Rasethaba, the chair of the State IT Association, and Mafika Mkwanazi, deputy CEO of Transnet and chair of South African Airways, are also listed as directors.  

Eads was formed from a merger of three companies — Aerospatiale Matra South Africa, Construcciones Aeronauticas South Africa and Dasa. 

The Sunday Times revealed last week that the Mercedes Benz ML320 4x4 ordered by Dasa in October 1998 was registered in Yengeni’s name a few days after it was ordered as a “private staff vehicle”.

DaimlerChrysler SA said this week the 4x4 was bought by Dasa on September 1998. Lulama Chakela, a representative for DaimlerChrysler SA, said an internal investigation by her company has found that Yengeni’s 4x4 was sold to Dasa in the “normal and regular course of dealing with an associated company”. 

Chakela said Yengeni bought the car from Dasa (Eads) and approached DaimlerChrysler Finance Services in May 1999 with a view to get car finance, which he did. 

“Please don’t ask me why he bought it from Dasa or why he approached DaimlerChrysler Finance Services for financing. The transaction is between Dasa and whoever is investigating the matter,” Chakela said. DaimlerChrysler SA did not know what then happened to the car and had no further interest in the matter, Chakela said, adding that her company had nothing to do with the car finance Yengeni received from DaimlerChrysler Finance Services. 

“DaimlerChrysler Finance Services is an independent company from us. It is our sister company, but it has its own management and reports to DaimlerChrysler Germany,” Chakela said.

It remains unclear why Yengeni applied for car finance from DaimlerChrysler after he had been in possession of the car for seven months; or why the car was registered in his name three days after the car was dispatched to Dasa. 

It also appears that Yengeni’s receipt of finance from Daimler flouts DaimlerChrysler Finance Services’s own regulations. It is understood Yengeni could not have received the car finance had DaimlerChrysler Finance Services officials followed proper finance regulations, which would normally require financing to be secured before receipt of the car. 

The Mail & Guardian posed these questions to DaimlerChrysler Financial Services on Wednesday afternoon. The company replied: “We respect your concern to inform the general public. You are aware, however, that this matter is currently being investigated by the Investigating Directorate for Serious Economic Offences and we confirm that we are cooperating fully with this investigation authority,” said DaimlerChrysler Financial Services representative Amanda Wilmot. Wilmot added: “Whilst we have nothing to fear, we are not prepared to debate these issues in public and must therefore reluctantly decline to respond to your questions.” 

Shiburi referred questions to Kgorong Investment Holdings chair Letepe Maisela, who in turn said he had nothing to do with the matter. Chakela also said this week that Eads had since handed over documents relating to Yengeni’s car to state investigators probing the R43,8-billion arms deal. Chakela said Shiburi had informed DaimlerChrysler about his directorship at Kgorong Investment Holdings. 

The ANC said on Wednesday the allegations against Yengeni result from delays in the arms probe “creating a field day for speculative mischief-makers”.

Meanwhile, Ntshikiwane Mashimbye, the current chair of the defence committee, has travelled to France on a trip sponsored by Dasa and received a diary from RRS. This is recorded in the Parliament’s asset register.

Yengeni this week protested his innocence in a special address to the National Assembly, saying reports that he was given the luxury 4x4 vehicle by a company linked to the R43,8-billion arms deal were untrue.

“The motor vehicle has been legitimately purchased by myself,” he said, adding that he was “reluctantly responding” to the allegations. 

During his tenure as chair of the defence committee Yengeni presided over the government’s defence acquisition management and defence review, which was accepted by Parliament in April 1998. The defence review recommended, among other things, the need for new radar systems. 

Yengeni says: “The acquisition of the vehicle did not in any way whatsoever influence the award ... of any contract in the arms procurement, which is under investigation.” 

With acknowledgment to Evidence Wa Ka Ngobeni and Daily Mail & Guardian.