SHOPRIT: 19,170 0 (0.00%)
South Africa's Treasury backs CEO of $160 bln state pension fund
* Finance Minister Nhlanhla Nene has faith Dan Matjila
* UDM alleges Matjila misused funds, made careless
* PIC is biggest equity investor in South Africa
(Adds Matjila comment)
By Tiisetso Motsoeneng and Wendell Roelf
JOHANNESBURG/CAPE TOWN, May 31 (Reuters) - South Africa's
National Treasury on Thursday rallied behind Dan Matjila, the
chief executive of the government's 2 trillion rand ($160
billion) state pension fund, dismissing a Bloomberg report that
said it was considering his suspension.
Matjila, who has headed the Public Investment Corporation
(PIC) since 2014, has come under pressure in recent weeks after
an opposition party asked the Treasury to suspend and
investigate him over allegations of misuse of funds and
careless investment decisions.
"Treasury has faith in Mr Dan Matjila's leadership," it said
in response to emailed questions. "The Minister is satisfied
with the PIC's overall performance."
The PIC and Matjila himself also dismissed the "rumours"
that he would be suspended.
"I donít know where these rumours are coming from that Iím
going to be suspended," Matjila told reporters in Cape Town.
"I've been there for 15 years, I am comfortable. We've done
a great job, my team is there motivated as ever. We are
producing the results for our clients and most importantly our
clients are happy."
The United Democratic Movement's (UDM) allegations come
three months after Cyril Ramaphosa took over as president of
South Africa on promises that included rooting out corruption in
government and state firms.
The UDM alleges that Matjila used funds to bankroll a
business of someone close to him and was not prudent in paying a
4.3 billion rand for a 29 percent stake in loss-making
technology upstart, Ayo Technology.
Responding to criticism over the investment in Ayo
Technology, Matjila said the investment was prudent: "It was a
great investment. All investments you have to wait to see the
CLEARED OF WRONGDOING
Last year, he was cleared of any wrongdoing by an internal
audit committee that looked into allegations that he bankrolled
the business of someone close him.
UDM leader Bantu Holomisa said: "We're challenging Ramaphosa
to walk the talk." He said his organisation was preparing to
send a letter to Ramaphosa to investigate the allegations.
In the letter, dated May 31 and seen by Reuters, UDM said
Matjila should be investigated by an independent party for
making questionable investments in companies such as Ayo
Technology and crisis-hit retailer Steinhoff .
In an interview with weekly magazine the Financial Mail,
published on Thursday, Matjila defended the fund's investment in
Ayo Technology, saying it was a decision based on the prospects
of the company.
"We backed a strong BEE company," Matjila told the Financial
Mail, referring to companies majority-owned by black people. "We
thought that price on the table was reasonable," he said.
Ayo Technology, which debuted on the Johannesburg bourse in
December last year, is trading at 35 rand per share, giving it a
market capitalisation of around 12 billion rand. That suggests
the PIC stake is now worth roughly 3.5 billion rand.
The PIC is the biggest investor in South Africa's economy,
holding a large chunk of government bonds and stakes in
blue-chip companies such as miner Anglo American,
lender Barclays Africa and grocer retailer Shoprite
($1 = 12.4882 rand)
(Editing by James Macharia and Jane Merriman)
First Published: 2018-05-31 09:11:13
Updated 2018-05-31 14:06:19
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