Denel refutes allegations of malfeasance in suspended Dynamics CEO case

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Denel has recently found itself refuting allegations of malfeasance made by suspended Denel Dynamics CEO Sello Ntsihlele.

In a statement issued on 25 May, the company said it has consistently maintained its commitment to confidentiality regarding internal disciplinary processes and refrains from discussing them publicly. However, the company firmly denies the allegations raised by Ntsihlele, specifically regarding the unlawful sale of assets and key intellectual property at significantly lower values than their market worth. Denel conducted a thorough investigation into these claims through an independent body, which found them to be false and baseless, the company said.

In response to the allegations, Denel extended an invitation to the suspended CEO to participate in the processes relating to his other grievances. Ntsihlele declined this opportunity, leading the company to decide not to entertain his claims any further. Ntsihlele is facing 24 charges of insubordination.

Ntsihlele alleges that his opposition to what he saw as unlawful instructions from Public Enterprises Minister Pravin Gordhan and Denel board chair Gloria Serobe led to his suspension. This emerged in court documents filed in an urgent application at the Labour Court last week.

Ntshihlele is asking the Labour Court to interdict Denel Group from forging ahead with disciplinary action against him because he refused to implement Gordhan and Serobe’s instruction to give newly appointed chief restructuring officer, Riaz Saloojee, unfettered access to company systems as a whole.

In his affidavit, City Press reports, Ntsihlele claims Gordhan and Serobe set the tone for his demise when they not only parachuted Saloojee into his position as a board appointment but also warned that those who would not toe the line and follow the board’s instructions would be cut from the organisation.

The suspended chief executive alleges that Gordhan – as the chairperson of a meeting on 18 August 2022 – told those in attendance to start filling out resignation forms if they did not agree with his approaches to restructuring of the company.

Gordhan retaliated last week, saying that Ntsihlele’s disciplinary process was the prerogative of the board of directors “which must do its work and see it to its logical conclusion without interference or any other attempt to deflect attention from the real issues that pertain to stabilising Denel”.

Despite the allegations from Ntsihlele, Denel remains determined to proceed with its restructuring initiatives. “Denel and its management team are progressing well with its bold steps of streamlining and refocusing its operations and are fully committed to implement its strategy and turnaround plan which is supported by the shareholder [Department of Public Enterprises] and Government. The focus of this is to build a sustainable business and return Denel to profitability,” the company said.