Cape Town - Public Investment Corporation (PIC) listed equities general manager Lebogang Molebatsi has told the Western Cape High Court that he considered the ICT investment Group, AYO Technology Solutions (AYO), to be a good investment and advised the PIC to buy shares in it.
Molebatsi, who was testifying at the ongoing case in which the PIC is looking to dissolve and recoup its R4.3 billion subscription agreement in the listed technology firm, admitted saying on several separate occasions that he considered AYO to be a good investment.
Molebatsi, questioned about his role in the deal, admitted under cross-examination by AYO senior counsel Nazeer Cassim, to having signed memos supporting the transaction several months later.
Molebatsi was part of the PIC transaction team, which also included then PIC executive head of listed investments, Fidelis Madavo, former assistant portfolio manager Victor Seanie, who was the first witness in the case, and Seanie’s line manager at the time, Sunil Varghese.
In response to a question from Cassim on the methodology used to arrive at the decision that AYO was a good investment, Molebatsi said they based their support of the transaction on a series of internal discussions and debates as well as the information they had on AYO at the time.
“We have a team of sector specialists who we interrogated, discussed and debated with while looking at a strategy. For us, the relationship AYO had with British Telecom SA was the anchor to drive further aggressive growth,” he said.
The questions to Molebatsi from both the PIC senior counsel, Vincent Maleka, and Cassim were based mainly on his previous testimony at the Mpati Commission of Inquiry into impropriety at the PIC, back in 2019.
Molebatsi also admitted that he was one of the senior employees of the PIC who advised the Government Employees Pension Fund (GEPF), which describes itself as Africa’s largest pension fund, in an April 2018 report, that “AYO was an attractive, catalytic investment”.
He said this had come about at a time when there had been media reports about the PIC’s investment in AYO and the GEPF had been asking for an explanation.
Asked by Cassim whether the due diligence report the transaction team delivered to the PIC portfolio management committee advised that the risk of the investment was low, Molebatsi said: “Yes”.
He also said that he had enough comfort in the transaction independently of then PIC chief executive Dr Dan Matjila’s views on the investment.
Later in the afternoon, Maleka introduced the PIC’s fourth witness, Professor Harvey Wainer, introduced as an expert on financial matters with a particular focus on valuations. Wainer has previously lent his expert services to several High Court matters in South Africa and abroad.
AYO also had its own expert, André Pieterse, and as required by the civil matters rules, the two experts had met and discussed aspects of their expertise in matters relating to the case.
While Maleka was leading Wainer’s evidence, Cassim rose to tell the court that he would argue that Wainer’s opinions were irrelevant to the court.