JOHANNESBURG -- A Cape Town defence company plans to hold off suing the government until President Thabo Mbeki decides whether to involve anti-corruption unit head Judge Willem Heath in a multi-agency probe into the R43billion arms deal.

Richard Young, managing director of CCII Systems, who turned to several agencies including Public Protector Selby Baqwa for relief, has been advised by the latter to go to court. His company was originally identified by the South African Navy as the preferred supplier for the integrated management system for the navy's four new German corvettes, which forms part of the controversial deal.  

Young claimed the contract was awarded to another company with links to former defence officials. He also forwarded his information to Heath and the auditor-general, who in a special report to Parliament last year recommended that his grievance be the subject of a separate forensic audit investigation. 

Young also briefed Dr Gavin Woods, the chairman of Parliament's watchdog public accounts committee, which in November recommended a multi-sectoral probe into the acquisition programme.  Young plans to sue for damages of between R100 and R200million -- but will only go to court if Heath is excluded from the probe, he told Sapa yesterday.

On Friday Mbeki's office said it was awaiting a recommendation from Justice Minister Penuell Maduna. Maduna will only consider the matter this week as he has been on leave. Young told Sapa last year he had investigated the matter for 18 months and had incontrovertible proof of irregular acquisition practices. 

Meanwhile, the state armaments agency, Armscor, has called a media conference for today to answer allegations of corruption against top officials. This follows reports that two American businessmen were also planning to take it to court for damage totalling about R2bn after a deal to purchase surplus SA Air Force transport aircraft apparently fell through.

Their company, Quantam International, claims it concluded an agreement with Armscor for the purchase of nine surplus C-160 Transall aircraft and millions of dollars worth of spares. However, four days before the money was to be paid the deal collapsed.

They have also forwarded their claims to several investigative agencies. The Sunday Independent reported that Roy Segers and Richard Parker claimed the deal may have been stymied because former minister of defence Joe Modise, and Ron Haywood, the current chairman of Armscor, wanted to put together their own deal to buy the planes. 

Both Modise and Haywood vehemently denied the claims, the paper said. Current Defence Minister Mosiuoa Lekota only returned from leave yesterday and had not yet had time to investigate the matter. Modise plans to take media organisations to court for defamation following their reports on the alleged deal, e.tv news reported. He denied involvement in the deal, saying the allegations were rubbish and amounted to a vicious smear campaign.

With acknowledgement to Sapa and the Daily Dispatch.