Denel sets out priorities to Parliament’s Public Enterprises committee
The need to export its products to remain profitable has been cited by State-owned defence industry conglomerate Denel in a presentation this week to the Parliamentary Portfolio Committee on Public Enterprises as one reason for a currently disputed joint venture based in Hong Kong. Odwa Mhlwana, acting Denel Group Chief Financial Officer, told the committee the decision to extend its business footprint in South-East Asia via a strategic joint venture with VR Laser to create Denel Asia came from former chief executive Riaz Saloojee. He said the selection of partners (for joint ventures) was largely driven by market intelligence and existing relationships. “VR Laser has been doing business with Denel for more than 15 years and is responsible for fabricating hulls for mine-protected vehicles and mechanical structures for weapon systems,” he said, adding the decision to form Denel Asia was initiated by Saloojee and presented to the new Denel board at its first meeting on September 10. Shortly afterward Saloojee, Chief Financial Officer Fikile Mhlontlo and group company secretary Elizabeth Africa were suspended. Saloojee will not be returning to Denel as his contract expired in January this year and disciplinary proceedings are apparently underway against Mhlontlo and Africa. “He made a proposal in this regard to the current board on September 10, 2015. The board approved Saloojee’s request for authorisation,” Mhlwana said, adding that four other potential partners were considered before a decision was taken to go with VR Laser. This was based on the company’s experience and its track record with Denel.