Ithuba takes Tau and Sizekhaya to court over R180 billion lottery deal
According to the operator‘s legal team, Tau’s alleged disregard for the bidding rules and evaluation criteria has undermined the entire licensing process.
South Africa.- Ithuba Holdings, the current operator of the South African national lottery, has launched an urgent legal challenge against the awarding of the five-year lottery licence to Sizekhaya Holdings. Ithuba’s application, filed in the North Gauteng High Court in Pretoria on September 4, 2025, seeks to interdict the handover process, which is set to take effect imminently, alleging irregularities in the bidding and evaluation procedures.
The contract, valued at approximately R180 billion (€8.7bn), was granted by Trade, Industry and Competition Minister, Parks Tau, in late May 2025, marking the fourth such licence in the lottery’s history.
Ithuba contends that Tau deviated from established protocols during the selection process, which began years earlier amid delays and extensions to the bid validity period. According to court papers, Tau allegedly abandoned critical scoring criteria outlined in the Lotteries Act, including technical expertise and operational readiness, in favour of Sizekhaya.
Ithuba further claims that negotiations with the consortium commenced prematurely, before the official conclusion of the bidding phase, potentially compromising the fairness of the competition.
According to the operator‘s legal team, Tau’s alleged disregard for the bidding rules and evaluation criteria has undermined the entire licensing process. This latest legal dispute comes weeks after another unsuccessful bidder, Lekalinga Consulting, mounted a similar court action in July 2025, pointing to a pattern of dissatisfaction among participants.
At the heart of the allegations are concerns over potential conflicts of interest tied to Sizekhaya’s shareholders and affiliates. Several reports and Ithuba’s submissions point to indirect political connections, including the involvement of Deputy President Paul Mashatile’s sister-in-law as a shareholder, as well as links to prominent KwaZulu-Natal business figures like Moses Tembe and Sandile Zungu, who are perceived to have ANC affiliations.
Ithuba argues that these ties were not sufficiently scrutinised, raising fears of undue influence in a process meant to prioritise merit and transparency. The company, which has managed the lottery since 2015 and boasts a strong track record in revenue generation and social funding, expressed deep disappointment through its CEO, Charmaine Mabuza. He said: “Despite our proven performance and compliance, the process appears to have favoured Sizekhaya without proper justification.”
Tau denies bias, asserts award was merit-given
Through a detailed affidavit filed in August 2025, Minister Tau defended his decision, maintaining that the award was made on objective grounds with no prior knowledge of political entanglements. He emphasised Sizekhaya’s strengths in areas such as industry knowledge, financial stability, adherence to the Lotteries Act, social responsibility initiatives, local economic contributions and commitment to Broad-Based Black Economic Empowerment (B-BBEE).
Tau asserted that he had fulfilled his duties diligently based on recommendations from the National Lotteries Commission (NLC). He dismissed suggestions of bias, noting that the evaluation was merit-driven and free from external pressures at the time of the decision. He also pointed out that he has directed the NLC to look into the allegations against Sizekhaya that emerged after the contract was awarded, and the investigation is ongoing.
Sizekhaya rejects political influence claims
Sizekhaya Holdings, a consortium comprising experienced gaming and financial entities, has also rejected the accusations of impropriety. In a July 2025 statement, the group described the claims of political influence as “baseless” and welcomed the Minister’s call for further investigation, insisting it had adhered strictly to all requirements.
The consortium’s victory followed a protracted bidding war that saw Tau extend deadlines to ensure comprehensive assessments, amid earlier concerns from some quarters about favouritism toward Ithuba.
