PIC investment processes need to be free of external political influence
CAPE TOWN – The former chief executive of the Public Investment Corporation (PIC) Dr Dan Matjila on Monday ended his 12-day testimony at the PIC Commission of Inquiry, by stating that that the processes of investment must be robust and free of external political influence.
Matjila said the Politically Exposed Persons policy must be applied more stringently and should be expanded to cover “politically influential persons” to eliminate the scourge of patronage.
The former chief executive said he left the asset manager in good shape, following his widely publicised ouster, and said he was extremely proud of the legacy he was leaving behind at the PIC, as well as the PIC’s achievements.
“The growth rate from R308 billion In 2003, to well over R2 trillion 15 years later, was spectacular. I am proud that the fund’s assets have resulted in a more prosperous, stable and dignified retirement for nearly a million and a half South African workers.
“I am proud that I played a role In transforming the skills base at the PIC and in our partners in the asset management industry to be more representative of the demographics of this country, especially with the opportunities opening for black women.
“I am proud, also, that new funding opportunities were made available to a diverse group of black entrepreneurs through the lsibaya Fund when all they received from commercial banks was rejection. And proud that, during this time, the PIC advanced loans to several hundred SME’s and tens of thousands of students. I am chuffed that we have supported the emergence of black asset managers, black stockbroking firms, black advisory firms and Successful black entrepreneurs,” he said.
Matjila said what made him extremely proud was that all this was achieved under the most trying of market and political circumstances. “I wish my successors-in-title all the wisdom, forbearance and luck in achieving the vision and I pray that the spirit of ‘James Nogu’ has been cleansed from the corridors of the PIC forever.”
During his testimony, Matjila hit out at the asset manager’s attempts to recoup the R4.3 billion in invested in the listing of AYO Technology Solutions in 2017.
Matjila told the Lex Mpati-led commission that by the time he left the PIC, the asset manager had not lost money in AYO and that he could not understand why the PIC wanted to recoup the money.
“I think it is a suboptimal approach. I mean unless the law has been broken somewhere and the JSE has not done its work in approving the PLS (Pre-listing Statement), the basis of which an investment was made,” he said.
Matjila described the asset manager’s investment as a long-term investment that would change the landscape in the information and communication technology (ICT) sector.
He emphasised to the commission that R4.3bn investment in AYO was not lost and was earning interest. He said the impression that was created that the PIC lost money in this investment was off the mark.
He said that even the decline in the listed company’s share price was not a reflection of its value. “That is why I am saying that money is there, it’s a matter of how you apply it going forward, it’s not lost. The share price that you see of R8 a share does not reflect the value that sits within the company. It reflects the noise, the hype and all the negative reports around AYO, as opposed to the intrinsic value that sits within the company,” said Matjila.
The commission also wanted Matjila to answer to previous testimony from some of his erstwhile colleagues that he exerted undue influence over investment decisions.
“I don't understand where my colleagues were coming from in terms of me putting pressure on them. I was actually quite shocked that people were making statements that I was pressurising them.”
Business Report Online