Denel slams Treasury over Gupta venture threat

Denel has accused the National Treasury of political grandstanding for threatening to block its venture with Gupta-owned VR Laser.

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Johannesburg - Denel has become the latest State-Owned Entity to fire a broadside at the National Treasury after it accused it of political grandstanding over its threats to legally block the joint venture with a Gupta-associated company.

The state arms manufacturer also challenged Finance Minister Pravin Gordhan to show leadership and defence of the economy by stopping the court threats. It said Gordhan was disingenuous in his legal threats and had failed to approve the deal to frustrate Denel. The Treasury had indicated it was going to court to stop the Denel joint venture with VR Laser, which is linked to the Guptas.

The state arms manufacturer on Tuesday said it would oppose the court challenge by the Treasury. “It is strange that National Treasury is frustrating the Denel Asia joint venture when Denel is not putting up a capital investment,” it said.

“Only VR Asia is putting up R100 million to fund the business with Denel to share 51 percent of the profit,” it said.

The treasury and Gordhan have been caught up in simmering battles with State-Owned Entities.

The ANC on Tuesday came out in support of the treasury in its investigations of Eskom’s coal contracts with the Gupta-owned Tegeta. The contract is said to be worth millions of rand.

This is the latest battle between Denel and Gordhan, after an earlier ugly fight where the finance minister described Denel as belligerent. Denel said it informed the Treasury of a decision to establish Denel Asia in October 29, but said nothing. It said despite the urgency of the matter both the treasury and the department of public enterprises remained silent.

Denel said treasury sprang into action when the name of the Guptas was linked to the deal. “The allegations that Denel is ‘captured by the Guptas’ are unfounded and politically motivated,” said Denel.

“The Gupta family has no business joint venture with Denel and none of the Gupta family members or relatives are shareholders in Denel Asia,” it said.

Political Bureau