Transnet is said to have dismissed CEO Gama

Transnet’s board dismissed chief executive officer Siyabonga Gama on Sunday after losing confidence in his ability to lead South Africa’s state-owned ports and rail company, according to two people familiar with the matter.

The board sent Gama, 51, a letter notifying him of its decision to terminate his employment on Sunday, according to the people.

Molatwane Likhethe, a spokesman for Transnet, reached by phone on Sunday said: “At this point in time, I am not aware of any communication received by Mr Gama from the board.” An after-hours number couldn’t be located for Gama.

The company on September 27 gave Gama 10 days to explain why he should not be dismissed, arguing then that the board had lost confidence and trust in his ability to lead the company.

“The reasons provided to him by the board relate to alleged serious violations of his financial, procurement and fiduciary responsibilities as Transnet CEO,” the company said in a statement on September 27.

President Cyril Ramaphosa’s administration is clamping down on graft and tackling poor management at state-owned companies, which are cash-strapped and pose an increasing risk to the nation’s finances. Executives at state power utility Eskom Holdings and South African Airways are among those to have been replaced.

Transnet initiated moves to suspend Gama and two other executives in August, amid a probe into their roles in procurement contracts.

The company squandered billions of rand and broke regulations when it altered the terms of a deal to buy 1 064 new locomotives, an investigation by law firm Werksmans Attorneys found. A separate National Treasury-commissioned report found Transnet paid R509 million more for 100 locomotives after switching a supply contract to a Chinese rail company from Mitsui & Co of Japan.

Earlier this month, Gama defended the company’s locomotive purchases as having been based on the country’s economic growth trajectory. He spoke at the Joburg Mining Indaba conference.

� L.P