The emergence of the Gupta-owned The New Age newspaper in the South African print media market contributed to the downward trajectory plaguing the industry as it ate in to the government advertising spend that was earmarked for other media houses. This was according to Dr Dan Matjila, the former chief executive of the Public Investment Corporation who was testifying at the Mpati-led commission of inquiry into impropriety at Africa’s largest asset manager.
“The aim was to transform Independent Media into a black-owned and transformed company so that they can get government business. However, the new one got formed and all business was taken away. Our view was that Independent Media would get government business because it was the most transformed media company in SA at the time. It was about getting a black player that was transformed in the media to make a difference in the economy,” said Matjila.
Explaining why the PIC invested in Independent News and Media despite Government Employees Pension Fund’s concern, Matjila said the application started with the investment committee and made it all the way through to the board. He suggested that INMSA was upfront that the asset might not perform too well but would carry the mandate in terms of transformation.
“I was concerned with the idea of possibly assisting or allowing the Guptas to boost their propaganda machinery by taking up a shareholding in INMSA. Had they obtained any shareholding in INMSA it would have narrowed participation in the media space and seriously increased the risk of both diminishing competition and the risk of breach of competition law by the PIC.