BREAKING: SAA terminates services of BnP Capital

Cape Town - South African Airways (SAA) has taken a decision to terminate the services of BnP Capital as a financial services provider to the airline, the airline announced on Thursday.

The effect of this decision means that SAA has terminated both its appointment of BnP Capital as transaction adviser and the appointment to source funds on behalf of the airline. The decision was communicated to BnP Capital on Wednesday, the airline said.

News24 exclusively revealed on Tuesday that SAA's controversial appointment of the little-known finance company was not only expensive; it also put on hold an approved banking tender to Nedbank.

News24 revealed that SAA's board approved the awarding of banking services to Nedbank on May 27, for five years, at an estimated cost of R278m.

But the awarding of this contract would be on condition that the "Nedbank contract [be] deferred subject to [the] debt consolidation process finalisation".

The debt consolidation process that was underway at the time was the appointment of BnP Capital, a "boutique financier". It was appointed to advise the airline how to restructure its R15bn debt.

This would be done for a fee of R256m - even though SAA's treasurer, Cynthia Stimpel, said it could be done at a fraction of the cost. BnP Capital won the contract in March ahead of several well-established companies, including Nedbank, Regiments and Deloitte & Touche.

According to the Financial Services Board, BnP Capital's licence to operate as a financial services provider had been suspended earlier in the year.

Stimpel was subsequently suspended.

According to SAA it contacted BnP Capital on July 8 2016 to enquire specifically about claims that had been made involving the latter’s FSB licence.

SAA emphasised in its statement that no payments had been made to BNP Capital. The decision to terminate the service was arrived at after a review of the award to BnP Capital.

On Stimpel's suspension, SAA said she was placed on suspension by SAA management on July 5 2016 for misconduct as "she had acted in contravention of SAA’s code of conduct".

According to SAA the decision to suspend her had nothing to do with media reports suggesting that she had allegedly objected to SAA’s decision to award a tender to BnP Capital.

"Her suspension remains in place pending the finalisation of an investigation and a possible institution of a disciplinary hearing. Michael Kleyn has been appointed as acting group treasurer," SAA said.

"SAA remains committed to ensuring that the financial management of the entire group improves and the airline’s finances are turned around. In doing so, SAA also welcomes within the confines of the law (including its internal procedures) any report of a whistle-blower."

SAA said employees are reminded that disclosures in terms of the prevailing law are protected if they pertain to information about impropriety and have been made to the right person, according to the scheme established by the Protected Disclosures Act 26 of 2000 (PDA).

"Leaks of information by employees to entities which do not qualify in terms of the provisions of the PDA do not constitute protected disclosures under the PDA," the airline said.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot