TRANSNET & THE CLAIMS
Posted on 27 July 2009 by Railways Africa Editor
Transnet has refuted suggestions in the Sunday Times business supplement that it faces claims amounting to about R4 billion arising out of its locomotive tenders. As far as the 50 “like-new” R874 million project is concerned, it entered into an agreement with a joint venture made up of two parties: namely, Sibanye Trade & Services and the American Electro-Motive Diesel and Locomotive Company (EMD). In the case of the earlier tender for 212 new diesel locomotives, the same joint venture had been selected as the preferred bidder. This tender was later cancelled “due to irregularities identified as a result of a detailed investigation conducted by Ernst & Young, our internal auditors,” following an anonymous tip-off to public enterprises Alec Erwin.”The investigation identified a number of procedural irregularities in the procurement process, not least of which indicated a conflict of interest between a shareholder of STS and the chairman of the Transnet Freight Rail adjudicating committee for locomotives,” Transnet said. It was for this reason, and based on advice from independent legal counsel, that Transnet had no option but to cancel the tender which had not yet been contracted. Subsequently, an interdict action was brought against Transnet to stop it from proceeding with a separate tender for the acquisition, on a fast-tracked basis, of 100 locomotives. “We have already made our case in the South Gauteng High Court which found in favour of Transnet with costs awarded,” the parastatal said on a statement, adding: “No further action has been intimated or taken by any of the parties.”
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