MultiChoice board to investigate allegations of 'irregular relationship' with ANN7

(File)
(File)

Johannesburg – The MultiChoice board announced on Friday that it would be investigating allegations that the pay-TV company, which owns DStv and M-Net, made dubious payments to news channel ANN7, formerly owned by the Guptas.

Chairperson of MultiChoice's audit and risk committees Don Eriksson in a statement said the board was aware of various reports alleging that MultiChoice had entered into an irregular relationship for the carriage of ANN7.

"The board is aware that the ANN7 channel has caused real public concern because of the allegations of corruption levelled at the former owners of the channel," Eriksson said.

The channel was previously owned by the controversial Gupta family who have close links to President Jacob Zuma and his son, Duduzane.

ALSO READ: MultiChoice rejects #GuptaLeaks accusations on ANN7 payments

The channel is now owned by outspoken Zuma supporter and Gupta crusader, Mzwanele Manyi.

Eriksson said the allegations had a negative impact on MultiChoice's reputation.

The board has instructed the audit and risk committees to assess whether there have been any corporate governance failures at MultiChoice and report back to the board. If it is found that there were corporate governance failures, the board will take the necessary action, it said.

The committees have also been tasked to assess whether the total amount paid to ANN7 is comparable to payments made for other locally produced channels with due consideration being given to the estimated costs of running a 24-hour news channel.

Alleged kickbacks to SABC

News24 previously reported that MultiChoice had made a questionable payment of R25m to ANN7 and that the company had increased its annual payment to the channel from R50m to R141m.

MultiChoice insisted previously that there was nothing untoward with its relationship with ANN7.

The payments came after the family seemingly assisted former communications minister Faith Muthambi in getting Zuma to transfer certain broadcasting powers to her, something MultiChoice was lobbying the minister for.

Following the transfer of powers, Muthambi controversially pushed through a decision in favour of unencrypted set-top boxes, which benefitted MultiChoice.

ALSO READ: There were no clandestine meetings and no kickbacks with SABC - MultiChoice

Muthambi's decision flouted her own party's policy on the issue. The ANC supported encryption – required for pay-TV – to promote competition in the sector.

After a lengthy court battle, the Constitutional Court earlier this year ruled that it was within Muthambi's right to make policy decisions affecting the broadcasting sector.

MultiChoice however denied that there was any relationship between the policy outcome in its favour and payments made to ANN7.

In a statement, the company said: "MultiChoice rejects your insinuations in the strongest possible terms."

On Wednesday, City Press reported that MultiChoice was accused of paying R100m in kickbacks to the SABC in exchange for the public's broadcaster "political influence over digital migration".

• News24 is published by Media24. Both Media24 and MultiChoice are Naspers companies.

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