Eskom Treasurer Andre Pillay says former Eskom Executives Matshela Koko and Anoj Singh signed the outline of a business agreement with Huarong despite an instruction by the International Finance Corporation board not to sign.
The transaction would see Eskom receiving a $1.5 billion loan under unsustainable and expensive terms.
Eskom would further have to make a pre-payment of R 340 million before the loan was issued.
Pillay says he insisted that the transaction goes through a Request-for-Proposal in order to comply with proper procurement processes.
Pillay appeared before the State Capture Inquiry in Parktown, Johannesburg. He says former Eskom Chief Financial Officer, Anoj Singh gave an impression that he was unhappy with the transaction being presented by the financial firm, Huarong – but despite this he signed the non-binding term sheet of the transaction.
Pillay says he was uncomfortable with the signing of the transaction, arguing that the Huarong asset management team was accompanied by an African National Congress (ANC) political deployee by the name of Rex Madida when the Eskom delegation met with Huarong in China.
McKinsey and Trillian consultants
Earlier Pillay says there was an increased number of McKinsey and Trillian consultants at Eskom following the arrival of former Eskom Executives Brian Molefe and Anoj Singh.
Both companies have been accused of dodgy practices at the power utility.
Pillay says Singh tried to impose Gupta-linked company Trillian Capital on a number of transactions between Eskom and potential funders.
Pillay says Goldman Sachs rejected Trillian’s imposed involvement on a R30 million transaction that Goldman Sachs was discussing with Eskom.
Three witnesses have so far testified about corruption allegations at the power utility.
Pillay says Gupta-linked companies – Trillian and McKinsey – were hired to help prepare Eskom’s 2016 corporate plan. Pillay says he understood that then Eskom CFO, Anoj Singh, had links to the firms.
“I was in a meeting, the Trillian and McKinsey representatives were in the meeting. We discussed the corporate plan and they arrived at our offices in the treasury to say that they are assisting Singh and they need certain information. [Question] Was that the first time to your knowledge that you got to know they are going to be involved in the preparation of the plan?//[Answer] In the meeting it was clear that we had the discussions with them in the room that broadly they were basically helping us with everything Chair. Nobody asked, we got into the meeting and it starts and we discuss what has to happen.//[Question] And Mr Singh would have called that meeting?//[Answer]He would have called it and chaired it.”