By Martin Williams*
The resignations and the departures for Dubai are part of a desperate attempt to save Oakbay’s questionable R2.1 billion deal to buy Optimum Coal.
The Zupta propaganda machine underestimates the intelligence of South Africans. Defenders of Jacob Zuma and the Gupta family fail to realise that most of us don’t believe their rubbish. Their credibility ranks even lower than their tainted image in financial circles.
Facing ostracism by banks and audit firms, the Guptas and Duduzane Zuma resigned their directorships in Oakbay Investments. In doing so, they said they were “confident that through the family’s decision to distance themselves from the business, banking relationships will soon be restored‚ salaries will be paid and business will continue as normal”.
Fat chance. Let’s cut through the nonsense. First, none of the main players sold their Oakbay shares, so they still control the company and all its entities, including those poised to reap billions from mining and nuclear deals. So, what credible institution would be fooled by this ruse? None. The same argument still applies, whether or not the Guptas move to Dubai, India or to anywhere else in the world. They could still control Oakbay. Geographical distance in not an insurmountable hurdle in the modern age.
Second, these resignations are a transparently weak attempt to evoke sympathy for the Guptas by suggesting that the banks will be to blame if Oakbay’s 4 500 employees don’t receive their salaries. However, the banks would not have cut ties if they thought the Guptas were beyond reproach. So, in fact, it is the business practices of the Guptas which have placed employees’ income at risk.
Stories about suitcases of cash being shipped to Dubai would also have spooked banks, which recently paid heavy fines for what Alec Hogg calls inadequate money laundering controls. Oakbay’s putative market capitalisation of R19.2 billion is a matter of dispute. There is some puzzlement among analysts as to what keeps Oakbay shares from crashing through the floor.
The resignations and the departures for Dubai are part of a desperate attempt to save Oakbay’s questionable R2.1-billion deal to buy Optimum Coal. The Guptas are committed to paying for the mine. They are banking on the deal going through, and on securing lucrative arrangements with Eskom. Now that they are being treated like pariahs, the Guptas may be unable to honour their side of the bargain.
If so, the effect will be like removing a crucial piece from a house of cards; everything will come tumbling down. Well, almost everything. The Guptas, plus a few Zumas, and a retinue of lackeys in key government and parastatal posts, will suddenly have much poorer prospects. The trickle of rats deserting the sinking Zupta ship will turn into a stampede when they realise the supply of easy riches is running out.
Finance Minister Pravin Gordhan is withholding the keys to the Treasury from predators placed in SAA, Denel and elsewhere. Financial institutions are keeping the Guptas at a distance. In these ways, cash flow, the lifeblood of the patronage network, is being squeezed. So it is only a matter of time.
Zuma is going down, without a doubt. Yet the long war against corruption is far from over. Tentacles run deep and wide in the ANC. The struggle continues.