Trade, industry & competition minister Parks Tau’s decision to pick a consortium led by KwaZulu-Natal businesspeople Moses Tembe and Sandile Zungu as the preferred bidder for the lucrative eight-year licence to operate SA’s national lottery is likely to be challenged in court.
The choice of Sizekhaya Holdings confirms a Business Day report that Tau had opened negotiations with the Goldrush Consortium after a protracted bidding battle marred by the participation of politically exposed people.
Tau said on Wednesday he had picked Sizekhaya as the preferred bidder after a “difficult” process.
“This ends a long and difficult process of evaluating eight applications for the fourth licence. I appreciate that this has been an enormous and complex endeavour,” he said.
Sizekhaya pipped seven other bidders, including incumbent Ithuba. Goldrush owns 50% of Sizekhaya. Ithuba, whose licence lapses at midnight on Saturday, said it was considering legal options available to it. The decision undermined principles of localisation and inclusive economic growth set out in the request for proposal, it said.
“Ithuba Lottery has at its disposal the necessary infrastructure, financial resources and distribution systems capable of delivering a seamless, secure and uninterrupted National Lottery. This decision disregards the progress made in building a truly home-grown lottery ecosystem that empowers small businesses, drives local job creation and channels maximum revenue to good causes.”
According to company records, Sizekhaya lists Tembe, Goldrush CFO Michael Nurick, horse racing boss Fundi Sithebe, medical doctor and National Research Foundation board member Mabatho Mutshekwane as directors, as well as Lebogang Ndadana, who sits on the audit committee of the National Empowerment Fund (NEF), which holds a 20% stake in the lottery licence on behalf of the state.
The NEF reports to Tau.
Goldrush owns and operates more than 25 bingo licences across SA. Goldrush told investors it welcomed Sizekhaya’s appointment.
“The selection of Sizekhaya bears testament to the depth and agility of the Goldrush management team in obtaining and managing gaming operations in SA,” it said.
Shares skyrocketed
Shares in Goldrush skyrocketed more than 7% on the news, bringing gains since Business Day’s reporting three weeks ago to about 70% and valuing the company at more than R400m.
The company, which looks set for a rerating in investor portfolios, said its licence, worth an estimated R90bn, would commence in June 2026, bringing into question the lottery’s fate until then.
A 12-month temporary licence awarded to Ithuba by Tau was last week set aside by the high court. The order was suspended for five months, with the judge of the view it is sufficient time for the new operator to take over.
The National Lotteries Commission (NLC) on Monday launched an urgent bid, asking the court to amend the order to act for a 12-month licence, as Ithuba is not prepared to run a five-month lottery, which will lead to millions of rand in losses.
Should the court dismiss the NLC’s application, the country will effectively be without a lottery from Sunday.
The application to invalidate the temporary licence was brought by an offshoot of Hosken Consolidated Investment, Wina Njalo, one of the bidders for the main tender, which is opposing the NLC’s application, with the matter set to be heard on Thursday.
Another bidder, the Afrinet-led consortium, is also considering its legal options.
The lottery licence saga exposes the tangled nexus between political patronage and legal wrangling, and the high stakes of government licensing. It also highlights the risks and uncertainties that come with awarding multibillion-rand government contracts.
Tau, who took office when the process was at an advanced stage in December, delayed appointing a preferred bidder after raising concerns about the evaluation process.
He said at the time that he needed to ensure no “political party or political office-bearer has any direct financial interest in the applicant or a shareholder of the applicant”.
The Business Day report showed how politically connected entities were in the running to win the lucrative tender. One was the Ringeta Consortium, led by Thebe Investments, and Absa chair Sello Moloko’s investment company, Thesele Group.
Thebe Investments is half-owned by ANC benefactor Batho Batho Trust, which, according to declarations made to the Electoral Commission of SA, has donated R60m to the ANC since 2021. Batho Batho Trust was founded by ANC leaders in 1992.
HCI is majority-owned by the SA Clothing and Textile Workers’ Union (Sactwu), an affiliate of ANC ally Cosatu. HCI is run by trade unionist-turned-businessperson Johnny Copelyn, who donated to President Cyril Ramaphosa’s CR17 campaign for the ANC presidency. Former trade, industry & competition minister Ebrahim Patel is a former Sactwu secretary-general.
Patel presided over much of the tender process until he left office a year ago.
The Goldrush bid has not been without controversy either.
City Press reported in 2024 that Thiran Marimuthu, who sits on the NLC’s licence bid evaluation committee, has close links with the Goldrush Consortium and attended the 25th anniversary organised by it in November 2024 — when the tender was still live.
Another bid evaluation member, Anne-Marie Pooley, invested in 2024 an establishment in Pretoria, Route 515 Pub and Grill, that houses Goldrush slot and gaming machines.
Company records show Pooley became the sole director of the entity in March 2024.
Zungu challenged the ANC KwaZulu-Natal chair position in 2022 before dropping out after he failed to garner enough support.
The EFF said it was opposed to the award of the tender to Sizekhaya, raising the involvement of Zungu and Tembe in the consortium.
“The EFF is in consultation with its legal counsel to consider judicial review of the decision, which includes, but may not be limited to, interdicting the awarding of the contract. Another bidder, the Afrinet-led consortium, is also considering its legal options.”
Update: May 28 2025
This story has been updated with more background information throughout.
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