CAPE TOWN - Scandal ridden Trillian Capital on wednesday moved to rid itself of its Gupta links when it announced that it had reached an agreement with its primary shareholder, Trillian Holdings, to sell its share to the company.
Trillian Holdings, which is controlled by Gupta family benefactor Salim Essa, will dispose of its 60 percent stake in Trillian Capital to Eric Wood, the company’s chief executive.
The company said in a statement that unrelenting media allegations arising from Essa’s holding in the company have had a negative impact on the ability of the group and its staff to reach their full potential.
“Trillian has always maintained its innocence in the face of allegations and reiterates the belief that it has a team of excellent staff who are able to deliver on their mandates to the highest standards and hope they will be given a fair opportunity to do so in the future,” the company said.
Last week, Eskom admitted that it paid the Trillian group of companies R495 million in consulting fees as part of its R1 billion deal with global consulting firm McKinsey.
The payment was made despite Trillian not having directly carried out any work for the utility.
The power utility has since launched a probe into why it paid Trillian despite not having a contract with it.
Trillian said it was unfortunate that Essa had taken the decision to divest from the business as he was on course in creating a leading black advisory business.
“The transaction is part of the company’s strategy to reshape the business and continue to deliver world-class financial advisory and consultancy services.”
Under the terms of the deal, Wood will up his stake in the company to 85percent, while the rest of the shares will be owned by the group’s management and staff.
The company did not mention how much the transaction was worth.
Essa's departure is the second major departure this year from the corruption-tainted company.
ANC heavyweight Tokyo Sexwale last month announced he was stepping down as the chairperson of the company, after he released an external investigation he had commissioned into an allegation that the company had been involved in underhanded state capture business dealings.
Trillian Capital was initially flung into the state capture spotlight after an affidavit by a whistle-blower alleged that Wood had briefed his team about Nhlanhla Nene’s firing two months before it occurred.
Essa has been under intense scrutiny after his links to the Gupta family were established through numerous companies and transactions.
Elgasolve, which is wholly owned by Essa, at one point held a 75percent stake in VR Laser Services, a steel fabrication company in which Gupta family investment vehicles have a 25 percent shareholding.
And Elgasolve owns about 22percent of Tegeta Exploration and Resources, a Gupta- controlled company that controversially bought Optimum Coal from Glencore a few years ago.
New structure
The move by Wood to buy out Essa was not completely a surprise as Wood had indicated recently that plans were afoot to have a new structure to move away from Gupta links.
However, questions remained as to how the divestment of Essa in the company will help its battered reputation as Essa himself has been embroiled in the state capture allegations and of fleecing state-owned enterprises.
A former business associate of Woods at Regiments Capital has alleged in an affidavit that Woods had laundered more than R10m to sponsor the Gupta-backed South African of The Year Awards two years ago.
Regiments directors’ Litha Nyhonyha and Niven Pillay have laid criminal charges relating to alleged money laundering involving R17m in payments made to the Gupta-owned newspaper, The New Age (TNA), as sponsorship of the awards.
They claim the money was paid using fictitious invoices by Wood under the pretext that Regiments was placing adverts with TNA.