Riaz Saloojee, group CEO of Denel. Picture: MARTIN RHODES
Riaz Saloojee, group CEO of Denel. Picture: MARTIN RHODES

EXECUTIVES and board members of state-owned arms company Denel were on Wednesday saved from having to deal with the slew of negative media reports about the company.

It emerged earlier this week that the joint venture between Denel and the Gupta-associated company VR Laser has not been approved by Public Enterprises Minister Lynne Brown or by Treasury and is, therefore, not legal under the Public Finance Management Act.

Denel and VR Laser formed Denel Asia last month and registered the company in Hong Kong.

When Denel officials appeared before Parliament on Wednesday the chairperson of the National Council of Provinces’ select committee on communications and public enterprises Ellen Prins said they should rather submit a written report on allegations relating to the joint venture..

The officials could also not comment on the suspension of three top executives, saying this was because disciplinary procedures were under way against them for alleged breaches of the Public Finance Management Act and other issues.

Insiders believe that CE Riaz Saloojee, chief financial officer Fikile Mhlontlo and company secretary Elizabeth Africa were suspended to clear the way for the VR Laser deal.

Acting chief financial officer Odwa Mhlwana said the group continued to improve on its performance as a result of restructuring and turnaround interventions.

Exports were critical to its long-term sustainability, especially in the current context of a financially constrained fiscus.

Last year exports represented 52% of total turnover of about R5.8bn and the company would like to see this grow to about 60%. Key markets were in Africa, Brazil, United Arab Emirates and Malaysia.