The loan had to be paid back in June‚ but an extension was granted to December after Gordhan asked for Mashaba’s “indulgence” in rolling over the maturity of the note‚ given Denel’s serious liquidity challenges.
On Wednesday evening‚ however‚ Gordhan hit back in a statement in which he told Mashaba that the loan was concluded by a previous administration in Johannesburg‚ as well as a former Denel board‚ that Regiments Capital was appointed by the city and that the city should therefore investigate whether the contractual relationship between the metro and Regiments was properly entered into.
In terms of the loan‚ Gordhan said he had explained in his parliamentary answer that in 2007-2008‚ the Treasury and the department of public enterprises had approved a domestic medium-term note for R2.2-billion that allowed for both secured and unsecured loans‚ which was registered with the JSE.
Gordhan said at the time the loan was entered into in September 2012‚ Denel was a profitable state-owned enterprise‚ with a healthy balance sheet.
“Based on historical records‚ there are no indications that any breaches were committed in corporate governance rules or in Treasury’s public finance management regulations‚” Gordhan said.