In a landmark ruling that has sent shockwaves across the business and municipal sectors, the High Court of South Africa has declared Otis Tshabalala, a South African based businessman and co-developer of Terracotta Trading Private Limited, a delinquent director for seven years. This decision, delivered in January 2025, casts further doubt on the integrity of the Egodini Mall project, a US$60 million venture awarded to Terracotta Trading by the City of Bulawayo in 2015 but which has failed to materialize, ultimately leading to the project’s cancellation in February 2025.
The ruling stems from a lawsuit filed by Delta Property Fund Limited against its former executives, including Tshabalala, alongside Sandile Nomvete and Shaneel Maharaj. The court found that the trio engaged in fraudulent business practices, corruption, and gross mismanagement, breaching their fiduciary duties and unlawfully authorizing millions in irregular payments.
According to forensic reports by Deloitte and Mazars Forensic Services, Tshabalala and his co-defendants facilitated illegal transactions, authorized bribes, and entered into reckless financial agreements without proper due diligence. These revelations led the South African court to declare him delinquent, effectively barring him from holding directorial positions for seven years.
The declaration of Tshabalala as a delinquent director raises serious questions about the City of Bulawayo’s vetting process in awarding the lucrative Egodini Mall redevelopment tender. Despite his controversial business record, the city entrusted Terracotta Trading Private Limited—where Tshabalala played a key role—with a multi-million-dollar contract meant to transform Egodini into a state-of-the-art shopping and transport hub.
Since its awarding in 2015, the project has faced endless delays, with little to no visible progress on the ground. Bulawayo residents, business leaders, and civic organizations have long criticized the project’s stagnation, pointing to Terracotta Trading’s failure to meet contractual obligations. The cancellation of the tender in February 2025 has only solidified concerns that the city’s decision-makers did not conduct adequate background checks before awarding the project to a firm linked to individuals with a history of financial mismanagement.
In addition to being declared delinquent, Tshabalala and his co-defendants have been ordered to make substantial financial reparations. The South African court has ruled that they must pay:
- Compensation for financial losses suffered by Delta Property Fund Limited due to their misconduct.
- Reimbursement of all unauthorized payments made to unqualified brokers and third parties, including fraudulent commissions.
- Legal costs incurred by Delta during the extensive litigation process.
- Restitution for bribes paid to secure illicit financial deals.
The exact financial sum remains undisclosed, but legal experts estimate that it could run into millions of dollars.
With the contract officially terminated, the City of Bulawayo now faces a critical decision regarding the future of the Egodini Mall project. Many residents and stakeholders are calling for greater transparency and accountability in the tendering process to ensure that a similar fiasco does not happen again.
Financial analyst Thembelihle Donga said, “The Egodini Mall project was envisioned as a transformative development for Bulawayo’s economy. The recent court ruling against Mr. Tshabalala and his associates underscores the critical importance of thorough due diligence in public-private partnerships. The City of Bulawayo’s oversight in this regard has led to significant setbacks in our urban development goals.
“The Tshabalala case serves as a stark warning of the consequences of poor due diligence and the dangers of entrusting large-scale urban development projects to individuals with a questionable financial history. As Bulawayo authorities seek a new developer for Egodini, the priority must be ensuring that only reputable, financially sound, and competent firms are considered to prevent another decade-long failure.”
This case, she added, highlights the need for stricter oversight in municipal tenders and reinforces the growing demand for ethical governance in public-private partnerships.
