Johannesburg - Public Enterprises Minister Pravin Gordhan says the Denel Asia joint venture was created specifically to rob state-owned entity Denel of its intellectual property.
Denel Asia was to be a joint venture between VR Laser Asia, which was owned by Gupta associate Salim Essa, and state armed manufacturer Denel.
VR Laser South Africa was owned by Duduzane Zuma and Rajesh Gupta.
Gordhan told the state capture inquiry during his testimony on Monday that the Denel board was captured.
When asked how he concluded this, he cited the investigation by Amabhugane which showed how various Denel board members were regulars in Dubai and had their personal expenses paid by the Guptas.
There was collusion between the Guptas and the Denel board led by Daniel Mantsha, who is now former president Jacob Zuma’s lawyer, Gordhan revealed.
When Des van Rooyen was hired as the new finance minister, following Nhlanhla Nene’s dismissal in December 2015, an application for approval of the Denel Asia deal was submitted to his office.
However, van Rooyen was not able to approve the deal as he lasted in office for only two days and was then replaced by Gordhan.
After Gordhan returned as finance minister, the deal fell through which sent Mantsha on the attack against the Treasury and Gordhan over the refusal to put through the deal.
Gordhan cited the legality of the VR Laser/ Denel deal.
Gordhan also told the inquiry that the phenomenon of state capture could be traced back to when Barbara Hogan was removed as public enterprises minister in 2010 and attempts were made to change the boards of state-owned enterprises.
He also told the inquiry how former president Jacob Zuma insisted on the nuclear deal even though it was financially unsustainable.
Gordhan will continue with his testimony on Tuesday.