Top South African companies were left reeling this week after German software multinational SAP admitted that it paid more than R100million to Gupta-owned entities to secure contracts with Transnet and Eskom for tenders worth R660m.
The companies said they were conducting investigations into their contracts to determine future relations with the software giant. However, a software analyst warned that it would be difficult for the companies to get out of the contracts as replacing SAP could prove difficult.
“It’s not as easy as finding a replacement tomorrow because these guys (SAP) have a near-complete monopoly on software technology,” the analyst told Business Report on condition of anonymity. “So, for now, it will be a wait-and-see game.”
SAP provides software solutions to the country’s top banks, businesses, state-owned entities and companies. Among its clients is Standard Bank, Nedbank, Pick * Pay and the Development Bank of Southern Africa (DBSA). This week, SAP said it had initiated voluntary disclosure to the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) on information it had assembled on the Transnet and Eskom contracts.