Publication: Sunday Argus Issued: Date: 2004-10-10 Reporter: Jeremy Gordin

State Case Hinges on Use of Zuma's Name



Sunday Argus

Date 2004-10-10


Jeremy Gordin

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In the forthcoming trial of Schabir Shaik, the state will argue that Schaik and the Nkobi group, one of his companies, continually tried to secure business partners and opportunities by using the name and assistance of Jacob Zuma, the deputy president.

Besides doing so in the arms arena, the state will argue, Shaik and Nkobi relied on Zuma's name in a variety of negotiations or communications with, among others, David Wilson of the Renong Group of Malaysia, Peter Watt of Altron, Kuwaiti businessman Fouad Alghanim, Jeffrey Crane of Crane (Africa), Hakim Belo-Osagie, chairman of United Bank for Africa, and Grant Scriven of Venson PLC.

The Renong group, a large diversified Malaysian conglomerate with ties to the Malaysian government, was interested in finding opportunities for investment in South Africa after 1994. After investigating, the Hilton Hotel and the Point Development in Durban were identified by Renong as possible investments.

The Point Development was seen as a potential empowerment project because the land was effectively owned by the government through Transnet, Portnet and the city of Durban.

Discussions were held with Mzi Khumalo, the chairman of Point Waterfront Company, at which Renong outlined its ideas on how the Point Development could be implemented as an empowerment project.

Later, Renong was advised by Khumalo of the names of the representatives who had been nominated to look after the empowerment interests. Renong understood that these nominees had been approved by the government.

In the third quarter of 1995, an initial shareholders' agreement was signed between Renong Overseas Corporation, representing Renong, and Secprop 60, a shelf company representing the empowerment interests.

The nominated empowerment representatives were the directors of Secprop 60 and the company was later renamed as Vulindlela Investments.

In October 1995 the Point Waterfront Company called for proposals for the development of the Point and presentations were made to the board of the Point Waterfront Company in November.

Besides the Renong/Vulindlela joint venture, two other consortia made proposals, including one led by Shaik's Nkobi group.

The day before the presentation to the Point Waterfront Company, David Wilson, the managing director of Renong, was, according to the state, requested by Shaik to attend a meeting in the Nkobi group's offices.

Wilson attended the meeting. When he confirmed that Renong intended to make a presentation to the Point Waterfront Company, Shaik and others present indicated that the consortium, whose members were present at the meeting, was very influential and that it would not be in Renong's interests if they proceeded with the presentation with its current partners.

Shaik allegedly proposed that a joint presentation should be made with his consortium.

Wilson rejected this proposal and went ahead with its presentation. Renong was left as the only bidder. Wilson then allegedly experienced delays as a result of Shaik's interference and insistence that his consortium should be involved in the project.

As a result of this interference and the uncertainty it caused, Wilson thought it necessary to obtain confirmation at a political level that the chosen empowerment partners were indeed acceptable.

Shaik allegedly wrote a letter dated June 10, 1996 to the chairman of Renong, in which he confirms Nkobi's interest in acquiring 49 percent equity in the Point Development.

Shaik reminded the chairperson that he should send a letter to Zuma, after which point Shaik would be in a position to accelerate the development.

Zuma allegedly said that he was not happy with the persons nominated to represent the empowerment interests in the Point Development and proposed that Shaik should be involved in the project.

With acknowledgements to Jeremy Gordin and the Sunday Argus.