Johannesburg - The Organisation Undoing Tax Abuse (Outa) and the SAA Pilots Association (SAAPA) have launched a joint court bid to declare SAA chairwoman Dudu Myeni unfit to hold office.
The organisations approached the Pretoria High Court to declare Myeni a delinquent director who should not be allowed to sit on any board in South Africa.
In the combined summons launched with the sheriff of the court on Tuesday, the organisations charged that Myeni had at least on four occasions failed to perform her functions in good faith. Outa chairman Wayne Duvenage said evidence at its disposal suggested that since Myeni took over as SAA chairwoman in 2012, the national airline had lost at least R10.5 billion.
“The legal action brought against Myeni is based on our claims that she has been seriously remiss in her fiduciary duties and responsibilities as the chairperson and as such, has caused the airline significant harm, by contravening Section 162(5) of the Companies Act,” Duvenage said.
Outa's and SAAPA's case against Myeni is chiefly anchored on allegations that Myeni illegally appointed BnP Capital as a transaction adviser and extended its mandate to include sourcing of funds.
BnP was appointed last year to advise SAA on the restructuring of its R15 billion debt at a fee of R256 million against the advice of airline treasurer Cynthia Stimpel.
The two organisations said the board, led by Myeni, issued a letter of award that recorded an all-inclusive cost to SAA. They said the award was much higher than the cost proposed in BnP’s initial bid.
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BnP’s contract was later cancelled after Outa approached the courts to declare it invalid. Now Outa and SAAPA say Myeni attempted to pay BnP a R49.9 million cancellation fee.
They claim the matter was voted down by the board with Myeni the sole member to vote for it.
They further alleged that Myeni misrepresented SAA by informing Finance Minister Pravin Gordhan that the board had resolved to lease only two aircraft from Airbus instead of 10.
The organisations said Myeni had then illegally attempted to coerce the company secretary to doctor board minutes to concur with her version.
SAAPA, which said it represents 99 percent of SAA pilots, was listed as the second plaintiff in the matter. SAAPA chairman Captain Jimmy Conroy said the association had witnessed “delinquency” of the highest order since Myeni’s appointment to the board. “Our national carrier is quickly reaching the tipping point where its very survival is in question. We believe that this is a direct result of the accumulation of poor governance and dearth of expertise and strategic vision,” Conroy said.
He added that only 66 of the 748 pilots had objected to approaching the courts to get rid of Myeni. The two organisations said they had agreed to share the costs of the litigation.
SAA spokesman Tlali Tlali said that Myeni and the airline were yet to receive the summons.