Eskom board approved R1.6bn cash payment to Tegeta, Zondo commission hears
Eskom’s former head of legal and company secretary Suzanne Daniels has explained why she supported the R1.68 billion bank guarantee to Gupta-owned Tegeta Exploration and Resources.
Daniels appeared before the commission of inquiry into state capture on Friday to continue her testimony.
She has been implicated in state capture at Eskom.
In 2015, Eskom agreed to prepay R1.6 billion to Optimum Coal Mine.
Some board members told the commission they did not know at the time that the agreement was to help Tegeta purchase Optimum, which was going into business rescue.
Daniels, who was Eskom's company secretary at the time, assisted former CEO Matshela Koko and Former CFO Anoj Singh prepare the proposal to the board.
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She told the commission she supported the bank guarantee only because it would have been riskier for Eskom to pay Tegeta in cash.
"It, in effect, was the payment of upfront cash of R1.68 billion to the supplier. What it effectively meant was that the board authorized an upfront payment.
"The issuing of the guarantee, as strange as it may seem, was a better risk-mitigating factor for Eskom. Can you imagine had we paid the money in cash over to the supplier? There would have been greater issues.
“I supported it within the ambit of what was provided, because it was in the best interest of Eskom to hold on to the cash because we would have given 12 months of cash up front," Daniels told the commission.
She confirmed earlier evidence that the agreement was introduced to Eskom by Gupta associate Salim Essa.
Essa famously used an email address called 'Businessman' at the time.
Zondo grilled Daniels about her failure to provide legal advice to the board.
She said while Koko and Singh rushed the process, she did not have a reason to second guess them.
Zondo remained unconvinced.
