Majola’s liquidated company wins disputed Lesotho airport tender

A questionable tender to fix Lesotho’s dilapidated airport to meet international standards has been thrown into confusion – first by a liquidation order from a South African judge, then by a phone call from amaBhungane.

South African businessman Thulani Majola, who is well connected to politicians on both sides of the Lesotho border, won a controversial R35-million (M35-million) consultancy to supervise an urgent upgrade of Maseru’s airport.

But, unknown to the Lesotho government, Majola’s company was liquidated four months ago.

After a questionable tender process, in June 2021 the Lesotho ministry of transport awarded Majola’s LTE Consulting a contract to oversee the refurbishment of Lesotho’s dilapidated airport as the tiny Kingdom raced against time to meet International Civil Aviation Organisation (ICAO)’s standards, following ICAO threats to shut it down.

[sidebarContentQuote align=right]

Key takeaways

  • South African businessman Thulani Majola seemingly joined politically connected partners in Lesotho to win a tender to refurbish Maseru’s dilapidated airport.
  • A losing bidder has questioned how Majola’s company, LTE Consulting, won a tender on which it had not been invited to participate.
  • Majola’s company was already facing a provisional liquidation application in Johannesburg when the Lesotho tender was awarded — and the Gauteng High Court has since ordered its final liquidation.[/sidebarContentQuote]

But already on 18 March 2021 a provisional liquidation application had been launched by a creditor of LTE Consulting in the Johannesburg High Court. The application was granted on 9 June, a day before unsuccessful bidders were informed the contract had been awarded to LTE Consulting.

The company was accused of failing to honour a R23-million debt to its sub-contractor Kontinental Engineering Consulting, which built a bus station in 2020 for the City of Ekurhuleni.

An attempt at a settlement a month later failed and Kontinental went back to court, arguing that LTE Consulting had paid R14-million but still owed R8.9-million.

In court papers, Kontinental’s managing director, Dare Adediran, suggested that Majola had acted deceitfully.

“I verily believe that the respondent entered into the agreement of settlement only to avoid final liquidation and had no intention of paying the full indebtedness.”

Majola had resigned his directorship from LTE Consulting and changed the name of the company to Lesedi Technical Engineering Consulting, in what Adediran argues was an attempt to postpone the application “on a contrived basis”.

“Notwithstanding that the respondent was placed into provisional liquidation on 9 June 2021 the respondent continued to operate its business with impunity and it was only when a provisional liquidator was appointed and the respondent’s bank account frozen… that the applicant was able to secure part payment of its indebtedness.”

When the Lesotho tender was being awarded, Kontinental had already won the interim order to place LTE Consulting under provisional winding up.

On 24 February this year, after LTE had apparently disappeared from their own premises, Judge Marcus Senyatsi ordered the company’s final liquidation.

Three months later, the Lesotho government was still oblivious to the fate of their airport tender winner. It took a phone call from amaBhungane to reveal this to them.

The principal secretary to the ministry of transport, Maile Masoebe, who oversees the airport refurbishment project, seemed taken by surprise. “We have only started the investigations this morning,” he told amaBhungane on 23 May. “The matter is now with our legal division which has just written to LTE about this. Until a clear position is established, we may not discuss that. I will revert, said Masoebe.

Masoebe later refused to answer any further questions, telling amaBhungane: “It should be enough to say we are in the middle on investigations.”

Majola has told amaBhungane that he disputes the liquidation order.

“The order is false and all I want is for the contractor to complete the job as per the appointment letter, that is all, then we will pay them. The matter will be going to court and then you will know that they are claiming false amounts,” he said.

“Lesotho is also a sovereign state which has nothing to do with a tender where I am fighting with another company (Kontinetal). My work in Lesotho will not be affected in any manner.”

How Majola squares this with the fact that the company awarded the tender has been liquidated is unclear.

The timing of the provisional liquidation — ahead of the tender award — poses questions about the due diligence carried out by the Lesotho transport department and about whether Majola was under a duty to disclose the precarious position of the bidding company.

However, those are only some of the questions raised by the oddities of the tender process and the opaque nature of Majola’s cross-border political and business relationships.

Read the liquidation papers here.

Mr. Congeniality

Majola will be familiar to amaBhungane readers.

His LTE group of companies has made headlines by acquiring lucrative South African government tenders while discreetly making significant donations to both the ruling African National Congress (ANC) and the opposition Economic Freedom Fighters (EFF).

See: Millions out, Billions in part I: Majola’s investment in ANC and EFF kept everyone sweet  and Millions out, billions in part II: Company that paid millions to the ANC and Malema scored big in Ekurhuleni

Previously there were also claims, denied but still unresolved, that LTE was close to former minister of water affairs minister Nomvula Mokonyane, who had allegedly been instrumental in pushing the company forward for projects, both in South Africa and Lesotho.

What is less known in South Africa is that Majola also has Lesotho citizenship and several businesses there, involved in operations ranging from cellular phones to construction to the health sector.

His pattern of forging political and business alliances appears to be reproduced in that country.

One of his Lesotho companies is the LTE Group of Companies (Lesotho). Another is LTE Consulting Engineers.

It had been puzzling as to which of the two LTE Consulting companies, one registered in South Africa and another in Lesotho, was awarded the Maseru airport tender. Majola finally confirmed to amaBhungane that the R35-million contract was awarded to his South African registered company — the same one which is being liquidated.

However, the relationship between the Lesotho companies and the South African head office is unclear, while the Lesotho incarnations of LTE appear to enjoy several connections to current or former political figures or their Lesotho business associates.

Tsatsanyane

LTE Group, registered in 2012, has Majola as a main shareholder, but also features (among other names) former Lesotho Transport Minister Mokherane Tsatsanyane as a founding shareholder.

Tsatsenyane is a man whose chequered history includes once being jailed for vehicle theft, serving as bodyguard to former Prime Minister Tom Thabane, and flipping from one political party to another.

Several attempts to contact Tsatsanyane were unsuccessful.

The convoluted airport tender process, which has dragged on since mid-2019, was begun by Tsatsanyane’s former ministry, transport, while he was still serving in government, first as deputy minister and then as minister.

It was prompted by fears that an inspection by aviation authorities might result in them shutting down the airport, where problems include a leaking roof, inadequate toilets and a runway too short to accommodate large aircraft.

But in May 2020, the Democratic Congress took power in Lesotho in coalition with the All Basotho Convention (ABC). Tṥoeu Mokeretla became minister of transport and succeeded Tsatsanyane.

Mokeretla refused to talk to this publication.

However, it seems that Majola also had connections with the new party in power, notably via one of its prominent supporters, controversial businessman Bothata Mahlala, who was also a founding shareholder of LTE’s other Lesotho incarnation, LTE Consulting Engineers.

Mahlala

Mahlala is a leading businessman in Lesotho, a key political party funder, and is said to be the “right-hand man” to the current deputy prime minister, Mathibeli Mokhothu, the leader of the Democratic Congress party.

Like Tsatsanyane, Mahlala has a colourful history.

In 2013 amaBhungane reported that Mahlala, together with a former Lesotho trade minister had benefited improperly from a government scheme that was intended to pay the rent of students studying in South Africa. He later denied any wrong doing.

Mahlala also made headlines in Lesotho when one of his companies, Big Bravo, won a R120-million Maseru City Council tender to refurbish roads in 2013.

The company was suspected of having won the tender with the help of then minister of local government, Mothetjoa Metsing.

Metsing and Mahlala were investigated by the Lesotho Directorate of Corruption and Economic Offences (DCEO)over deposits amounting to R524 964 which were made to Metsing’s bank accounts.

At the time, Mahlala was still a member and financier of the then ruling Lesotho Congress for Democracy (LCD), though he left the LCD for the Democratic Congress in August 2019.

The DCEO spokesperson, Matlhohonolofatso Senoko, told amaBhungane the corruption case was about to go to court when a new DCEO Director General, Mahlomola Manyokole, was appointed in July 2019.

He said Manyokole wanted to familiarise himself with the matter before it could proceed, but was himself suspended in January 2021 and there had been no progress on the case since.

In 2016 Mahlala was also charged with failing to submit income tax returns to the Lesotho Revenue Authority (LRA) since 2005, but in 2017 he applied to refer the matter to the Constitutional Court for determination of the legality of the charges and the matter is apparently still pending.

The airport tender and the riddle of Mahlala’s role

In December 2020, the tender to manage the airport upgrade was first hurriedly awarded to South Africa’s Airports Company of SA (ACSA) but then cancelled because tender processes had not been followed.

In February 2021, five other companies were invited to compete against ACSA in a bid process that was confined to invitees because of the urgent nature of the work.

However, LTE Consulting emerged as the winner, despite allegedly not having been invited.

We know this because, a losing bidder, WSSL Joint Venture, appealed the award to the finance ministry.

WSSL’s co-owner, Mophato Monyake, Lesotho’s former justice minister, wrote to the finance ministry’s Procurement Policy and Advice Division listing the six companies that had been invited to bid, which did not include LTE.

He asked that the department of transport be directed not to proceed with the award until the complaint had been finalized and “to produce the instrument that permitted them to clandestinely allow LTE Consulting (Pty) Ltd… to participate in the bidding process when they had not been initially shortlisted”.

The complaint was rejected on technical grounds, with the procurement tribunal ruling that Monyake did not have the legal authority to complain on behalf of the joint venture.

Monyake told amaBhungane that Mahlala attended all airport tender briefing sessions on behalf of LTE.

He was backed up by another competitor who lost to LTE, Geoffrey Moshabesha of PM Aviation Consultancy, who also claimed that Mahlala represented LTE in the tender briefing sessions.

Mahlala’s version

Mahlala disputed claims by these two losing bidders that it was he who represented LTE at the airport tender briefings. “You have called the wrong person. I do not know how you associate me with LTE,” he said, then hung up.

Later, when asked via text why his name was listed by the Lesotho ministry of trade and industry as a former LTE shareholder, he called back to say he had long left the company and therefore had no business with the tender.

“Majola is a close friend, more of a brother to me. We registered that company together a long time ago but I pulled out even before the airport tender and therefore had nothing to do with it.

“Its (LTE’s) current office bearer is one Lineo Nare whom you can ask about the airport issue.

“I may not be the DC treasurer but I would know if Majola was funding the DC. As my brother he would have told me.”

He said, contrary to claims he was funding the DC, that there were allegations that Majola was instead funding the ABC, because Nare was said to be close to ABC leader and former Water Minister Nkaku Kabi.

Nare

It is true that at the time of the airport tender in February 2021, Majola appeared to change horses at LTE Consulting Engineers.

Although company records confirm that Mahlala ceased to be a shareholder in January 2014, another shareholder, Paila Joseph Mofolo remained alongside Majola until 8 February 2021. Mofolo has other business links to Mahlala and his Facebook page suggests he is also connected to the Democratic Congress.

On 8 February 2021 Mofolo ceased to be a shareholder and instead Nare was substituted, with a 50% share of the company, alongside Majola.

Nare has a variety of Lesotho business interests ranging from medical supplies to cannabis.

One of her companies, Invest Lesotho, was awarded a sole source R1 152 000 contract to supply the Lesotho Defence Force with scrub suits and medical gowns in April 2021 as part of a series of Covid emergency purchases authorised by the office of the prime minister, the ABC’s Moeketsi Majoro.

The DCEO confirmed this contract was among a number being investigated.

Approached for comment, Nare told amaBhungane: “I will not answer any of your questions. Tell whoever sent you that they are wasting their time.”

Majola’s version

Majola told amaBhungane he had no ties with the ruling party in Lesotho and had won the tender fairly.

“My company, LTE Consulting, registered in South Africa was invited to tender… I have an email inviting my company to tender, how else would my bid be evaluated? How would I submit if I was not invited?

“I was even there at the tender briefings in person so whoever says I was not there is lying. There was no Bothata [Mahlala] but me. I will not prove anything to you because I do not work for you.

“You have been sent by a politician to come after me because your inquiry is not making sense. You are basing yourself on the lies they are telling you.”

Keketso is on a 3 month fellowship with amaB sponsored by the IJ Hub.