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The first witness in the delinquency trial of South African Airways' former chairperson Dudu Myeni said the national carrier lost a deal that would have guaranteed $100 million (about R1.5 billion) in revenue from Emirates in 2015.
On the third day of Myeni’s trial in the Palace of Justice in Pretoria, former SAA acting CEO Nico Bezuidenhout took the stand as the first witness in the civil matter. Bezuidenhout told the court on Friday that in January 2015, the biggest airline in the world approached SAA about a deal that would enhance the relationship which dates back to 1994.
As part of the deal, the two carriers would have expanded code-sharing relationships accompanied by a guaranteed annual revenue worth $100 million. This would have helped support the woeful SAA into generating profit through daily services between Johannesburg and Dubai, according to Bezuidenhout.
He testified that the deal was approaching a conclusion of the non-binding Memorandum of Understanding which would make way for more negations since there were no objections. Bezuidenhout said only one member of the board - Myeni - was against the deal.
She was required to travel to Dubai for the signing of the deal on May 5, 2015, but cancelled the signing 24-hours before, after advising Bezuidenhout "telephonically that [he] needs to say that the chairlady is sick," said the former acting SAA CEO.
Bezuidenhout said this caused serious strain to the relationship between SAA and Emirates.
"At this point it was starting to become a little bit more strange. I accept that different counties and different cultures have different perceptions of respect. It was my perception that there was a level of embarrassment among the executives of Emirates. It was unprofessional," said Bezuidenhout, who flew to Dubai to make amends.
According to the witness, Myenyi objected to the deal because Emirates was allegedly trying to "acquire SAA" and required that there be a clause against the acquisition in the MoU.
Among other reasons, the court heard that Myeni opposed the deal because Emirates wanted to transport animals from Johannesburg to Dubai. This was not true, according to Bezuidnhout.
"I can confirm that she (Myeni) was a non-executive. I can confirm that a non-executive member of the board never involves themselves in the executive decisions of the board. Even if the executive board is on its own, they are not allowed to involve themselves in the operational matters," Rashaad Pandor of Rashad Attorneys told Fin24.
Bezuidenhout is set to resume his testimony at the Palace of Justice on Monday morning.
