Ex-Adapt IT CEO Shabalala linked to controversial R7.3bn Lotto contract
Key topics:
Sbu Shabalala linked to Lotto contract awarded to politically tied firm
Concerns raised over Mashatile family ties and conflict of interest claims
Shabalala's past controversies resurface amid fresh legal scrutiny and reports
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By Staff Writer
Former Adapt IT CEO Sbu Shabalala has been linked to the controversial new Lotto contract, which has been awarded to Sizekhaya.
The Lotto contract is highly lucrative, with the outgoing operator, Ithuba Holdings, reporting a turnover of R7.28 billion in 2024.
In May 2025, Trade, Industry, and Competition Minister Parks Tau appointed Sizekhaya Holdings as the fourth national lottery and sports pools operator, effective 1 June 2026.
The issue has been contentious from the start, and Tau said this matter has already become the subject of litigation and a judgment of the High Court.
However, it is not only legal action which tainted the appointment. amaBhungane reported that Sizekhaya Holdings has links to Deputy President Paul Mashatile.
The investigative publication stated that Sizekhaya’s shareholders include Bellamont Gaming, a company co-owned and co-directed by Khumo Bogatsu and Moses Tembe.
Bogatsu is Mashatile’s sister-in-law, and Tembe is the KwaZulu-Natal businessman who chairs Sizekhaya, which amaBhungane said appears to be close to Mashatile.
In a follow-up report, amaBhungane said Shabalala, who is engaged to Khumo Bogatsu, played a key role in connecting all the players linked to the contract.
amaBhungane published numerous photos which showed Shabalala with key role players in the new Lotto contract.
The publication requested details from Shabalala about the issue, but he did not respond to this communication.
amaBhungane said Tembe dismissed questions about his relationships as an “invasion of privacy and humiliating”.
Mashatile has dismissed allegations of political interference in the awarding of the national lottery licence to Sizekhaya Holdings.
He argued that his family should be allowed to do business in South Africa as long as he is not involved in the company.
Tau told Parliament that all the allegations of conflicts of interest and potential political interference will be investigated.
Mondli Gungubele, Deputy Minister of Communications and a National Working and Executive Committee Member of the ANC, hit back at Mashatile.
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“It is the moral obligation of public figures to clarify to society when their friends or relatives are doing business with the state, not the obligation of the public to explain where they should do it,” he said.
Sbu Shabalala as Adapt IT CEO
Shabalala often made headlines during his tenure as Adapt IT chief executive. This includes controversial issues.
In 2009, Adapt IT was under scrutiny for its R6.5 million price tag for developing the Durban 2010 website ahead of the Soccer World Cup.
Democratic Alliance (DA) said “using the specifications provided by the City Council, the website could not possibly have cost more than R250,000”.
Shabalala explained that the cost included aspects like software licensing, hosting, and server management, which are not strictly part of the Adapt IT budget.
Another contentious issue was related to Adapt IT’s head office, which is owned by Mshengu Property Holdings, of which Shabalala is the sole director.
Having a CEO of a company that owns or partly owns the property the company uses as its campus raised questions about a potential conflict of interest.
Higher rent, for example, is good news for the CEO, but bad news for the company paying the monthly bills.
Adapt IT said there was nothing untoward regarding the deal. It explained that Shabalala recused himself from the decision regarding the property to avoid a conflict of interest.
In 2021, Shabalala made headlines after accusations that he ordered heavily armed men to beat up the partner of his estranged wife, Neo Shabalala.
He allegedly attempted to force his former wife into signing an agreement related to a legal dispute over financial matters. She reportedly claimed ownership of part of his assets, which she valued at over R133 million.
Shabalala said the armed assault allegations against him are without merit, describing it as a “cold-hearted campaign” which must be condemned.
In August 2021, Shabalala resigned as Adapt IT chief executive. “The board has duly accepted his resignation and wishes him well in his future endeavours,” Adapt IT said.
This article was first published by MyBroadband and is republished with permission