And so, this week, the Guptarisation of cricket in South Africa was quietly laid to rest. When Cricket SA (CSA) and its affiliates this week replaced Nkonki Inc as their auditor, the 14-year partnership South African cricket and Gupta-linked companies ended.
It started innocently in April 2004, long before That Wedding in Sun City in 2013 alerted South Africans that the Gupta brothers and hangers-on were our Machiavellian powers behind the throne. Then, a relatively unknown computer company called Sahara signed a naming rights sponsorship deal with the oldest three cricket grounds: Newlands in Cape Town became Sahara Park Newlands; Kingsmead in Durban became Sahara Stadium Kingsmead; and St George’s Park in Port Elizabeth became Sahara Oval St Georges.
At the time the Gupta-owned Sahara IT company was so unknown that it was initially confused with the big Indian IT company Sahara, which sponsored the Indian cricket team.
And interestingly, the Guptas actually paid R25-m for the 5-year naming rights – not the other way around, as frequently happened in later SOE state capture transactions.
As many may recall there was quite an outcry about the renaming of the grounds – as one could expect when you go and mess with some of the most hallowed names in cricket. But, the Guptas had always been marketing masters and they signed the 23-year old Protea captain, Graeme Smith, to be a Sahara brand ambassador.
According to Pieter-Louis Myburgh’s book, The Republic of Gupta (published by Penguin), Smith was a speaker during the ceremony announcing the naming deal, and he reminded the audience that the cricket federations needed money to survive. Not only federations, because when Smith launched his book A Captain’s Diary published by Jonathan Ball in 2009 at the Newlands cricket ground, Sahara was identified as the official book sponsor. At the book launch Smith heartily thanked the Guptas for their support during the previous five years, reports Myburgh. A new contract between Smith and Sahara for the next five years was announced at the launch, reported the Sunday Tribune.
The popular captain was soon joined by some of the most popular cricketers of the time, as team mates Shaun Pollock, Jacques Kallis, Makhaya Ntini, Boeta Dippenaar, Jacques Rudolph, Martin van Jaarsveld and Neil McKenzie became Sahara brand ambassadors in December 2004, continues Myburgh. Thus, the fans grew accustomed to the Sahara name linked to cricket.
To be fair, in those days a Gupta-contract didn’t have the same implications as it would have today.
St Georges Park was the first stadium to break the ties with Sahara – but as mentioned further on, they would not remain Gupta free for ever. In 2009 they found a new naming sponsor in Axxess DSL. In October 2015, Newlands gave Sahara the boot and PPC cement became the naming rights sponsor.
KwaZulu-Natal held on to their 13-year sponsorship deal until the Sahara business was closed in February this year, 18 months before the contract was supposed to end. At the time of writing it had reverted back to the name Kingsmead Stadium as KwaZulu-Natal Cricket Union president Fa-eez Jaffer lamented the end of the Sahara company, which, according to him, always paid up front.
Apart from naming the grounds, the sponsorship agreements obviously also bought the Guptas a lot of influence in cricket circles. Myburgh maintains that they influenced the Protea team’s playing schedule during their tour to India at the end of 2005 so that they could show off stars like AB de Villiers, Makhaya Ntini, and Graeme Smith in the Gupta home town Saharanpur (see News 24 video). National cricket team members were also given a Saxonwold send-off before international tours.
Ever since Mario Puzo immortalised the phrase make him an offer he can’t refuse in the Godfather book and films everybody knows that you ignore suggestions and offers from certain people at your peril … the affiliate unions therefore understood what they were meant to do when in September 2016 CSA made them the offer to swop the auditors they had appointed until then (like the highly regarded firm Deloitte) for an unknown black-empowerment firm called Nkonki Inc.
While each union’s members could appoint their own auditors at their AGM up until then, all unions knew that CSA had a point system that determines how much money is allocated to a union. We have been trying to get comment from the CSA Audit and Risk Committee why they wanted the affiliate unions to appoint Nkonki but had not been successful at the time of writing.
At the AGM on September 3 2016, CSA president Chris Nenzani, however, said that for the first time appointing one audit firm for CSA, its members, franchises and stadiums, “will bring efficiencies to the audit process”. He added: “This is a progressive move by CSA and the members and it re-affirms that cricket is committed to transformation both on and off the field.”
After it emerged that Nkonki was a Gupta front, bought by Salim Essa of Trillian Captial fame to audit certain state capture transactions in SOEs, the Auditor General Kimi Makwetu’s ended the government’s contract with Nkonki (and the compromised KPMG).
That was the end for 25-year old Nkonki, which had prepared and presented one financial report – 2016/17 – for CSA and its affiliates. This week CSA appointed PWC as cricket’s new auditor to finalise the 30 April 2018 year end audit. The last Gupta cricket link was broken.
And the sad part is that Nkonki could have been the subject of such a nice empowerment story, had they not struck a Faustian deal in September 2016.
According to a 3-part exposé called The Nkonki Pact: How the Guptas bought themselves an auditor by amaBhungane journalists Stefaans Brümmer and Susan Comrie, the firm was founded by Sindi Zilwa, neé Nkonki, the second black woman in South Africa to qualify as a CA in 1990. Her brother Mzi Nkonki, also a CA, joined her in the business, which gradually obtained more public sector work.
In 2013 Nkonki became one of three audit firms to be contracted as internal auditors by Transnet. Two years later, the Transnet account generated almost half of their revenues. In 2016, however, their work for Transnet dropped considerably and they were in trouble – to the extent that they failed to pay employee tax deductions to SARS.
Enter Trillian Capital CEO Eric Wood, who asked CA Mitesh Patel in August 2016 to approach the Nkonki’s with an offer to buy their black owned audit company. The Nkonki siblings, who were majority owners, CEO and chair of the firm, rejected the offer. The following month (September 2016) another offer was made by Patel to buy the Nkonki’s 80% shareholding – which they did not refuse.
The new Nkonki management team was soon awarded a new contract with Eskom – amongst others – and were appointed the auditors of all local cricket bodies early in September.
They remained under the radar for a year, but the amaBhungane investigative series on Nkonki was published in March this year, revealing that Gupta associate Salim Essa and Trillian Capital funded this so-called management buyout as a front for the Guptas. The Auditor General stopped all their government work.
CEO Mitesh Patel resigned early in April and the firm went into voluntary liquidation on April 24. Nkonki subsequently issued a statement, saying that “the 180 employees including the executives, management, divisional heads and the minority shareholder … are victims who had no involvement nor knowledge in the shareholding and loan transactions, the funding thereof nor the due diligence processes that were conducted”.