Inside the R1.1bn SA Steel Mills deal now under scrutiny
Why this matters: an international story with cross-border implications worth tracking.
Previously unreported affidavits have raised new questions about due diligence processes and a flawed business case upon which the Industrial Development Corporation (IDC) relied to provide more than R1.1 billion funding to SA Steel Mills (SASM), a steel manufacturing company based in Meyerton east of Johannesburg. A source with knowledge of the matter told the Mail & Guardian that two suspended IDC employees are facing a disciplinary enquiry for their role in the transaction, while questions remain about accountability for senior officials linked to approvals in the transaction. According to the source, a legal opinion commissioned by the IDC recommended sanctions against a former head of legal and regulatory compliance linked to approval of a Customer Account Management (CAM) Memo that enabled the final tranche of funding to be disbursed to SASM. Despite the IDC making staggered disbursements to SASM over a seven year period amounting to R1.1 billion, the steel manufacturing company has since been placed in business rescue, resulting in the loss of more than 1 100 jobs. Competing allegations of fraud and embezzlement contained in affidavits deposed by feuding parties have also raised questions about the IDC’s due diligence processes in continuing to fund SASM after the company allegedly stopped servicing its debt as far back as 2020. In his affidavit, Ashish Verma alleges theft of funds and large scale money laundering at SA Steel Mills. The steel manufacturer faced financial difficulty over the past few years, leading to the sale of Pro Roof Industrial Park, which owns SA Steel Mills and the land on which its steel mill operates. Alfeco, led by Ahuja, acquired the business in April 2024 but subsequently withdrew from the transaction. In a blistering attack on SASM’s previous owners, Verma names former financial director Peyush Bhana as one of the alleged masterminds behind the diversion of millions of rand from the company. At the centre of the dispute between th