AFRICAN National Congress Chief Whip Tony Yengeni has been granted R10 000 bail after appearing in the Cape Town Magistrate's Court on Wednesday morning in connection with charges of corruption.

He had earlier handed himself over to the crack Scorpions unit after a warrant of arrest was issued.

This follows an investigation into Yengeni's alleged involvement in purchasing a luxury Mercedes Benz ML320 4x4, at a discounted rate from a company which has a stake in the government's multi-million rand arms deal.

Wearing a light brown suit, Yengeni sat in the dock chewing gum as Magistrate Petro de Villiers filled out forms. He was not handcuffed.

Yengeni was not asked to plead and was granted R10 000 bail. The case was remanded to January 25 next year.

De Villiers said Yengeni's bail was conditional on him appearing before the specialised commercial crime court at 8.30am in Pretoria on January 25.

He also had to alert authorities should he wish to leave the country, she said.

De Villiers said if he failed to abide by this, he would re-rearrested and held in custody.

After paying the bail, Yengeni and his wife, Lumka, left the court in a blue Volkswagen Polo driven by a policeman.

Yengeni faces charges of corruption, alternatively fraud, statutory perjury and forgery, said a representative for the Scorpions, Sipho Ngwema.

Ngwema said a warrant of arrest had also been issued for European Aeronautic Defence Systems head in South Africa, Michael Woerfel, who is currently out of the country. This had been communicated to Woerfel through his South African-based lawyers.

Woerfel was suspended from his post in July, some time after EADS admitted that it had "rendered assistance" to some 30 VIPs to obtain luxury vehicles.

These included defence force chief General Siphiwe Nyanda.

Yengeni is the first politician to be arrested in connection with alleged corruption in the controversial arms deal under which South Africa is to buy fighter jets, submarines, corvettes and helicopters from Swedish, British, German, Italian and French firms.

Three government agencies began probing the post-apartheid arms overhaul in January at the insistence of parliament after auditor general Shauket Fakie released a report saying proper procedures had been sidestepped in the tender process for the deal.

Yengeni, who chaired parliament's portfolio committee on defence when the deal was being negotiated, in July took out full-page advertisements in newspapers in which he denied that he had been bribed and declared: "All is a witchhunt."

Eads has a 33% stake in Reutech Radar Systems, based in Stellenbosch, South Africa, which won a $25-million contract to supply missile and radar technology aboard the four corvettes the government has ordered. 

With acknowledgment to Sapa, AFP and the Mail and Guardian.