Durban : Schabir Shaik's Nkobi Holdings never concluded a joint venture with US multinational Symbol Technologies because the US company pulled out, the Duban High Court heard yesterday.

The state's first international witness called to give evidence, John Dover, was Symbol Technologies' Africa manager when Nkobi unit Kobitech and Symbol were discussing a possible joint venture.

The two sides investigated doing business because the $1,5bn, New York-based Symbol developed technology for reading barcodes, while Prodiba, a company in which Nkobi had a stake and of which Shaik was a director, had secured the contract to supply credit-card drivers' licences.

Under that agreement, Nkobi via Prodiba also had the contract to supply the transport department with 500 card-reading devices.

Additional devices for SA's law-enforcement agencies were to be supplied subsequently.

Dover, whose day in court interrupted the cross-examination of KPMG forensic auditor Johan van der Walt, said the protracted negotiations between the two parties had ended in October 2000.

This followed a board decision to put on hold any negotiations internationally as Symbol anticipated leaner times, he said .

However, before they ended, the focus of negotiations over the 18month period had swung from Nkobi and Symbol starting a company in which Nkobi had a 30% stake to Symbol acquiring a 26% shareholding in Nkobi for $2m.

By September 1999 Shaik and Symbol had entered "a tentative agreement" to establish the new company into which Symbol would transfer its South African operations and Nkobi would inject the Prodiba contract.

Dover said the multinational was aware Prodiba had only secured the initial contract to supply the devices, but said that Shaik represented himself as the financial adviser to Deputy President Jacob Zuma.

He said he viewed this relationship as offering the potential for Symbol to boost its sales in SA.

However, Van der Walt testified last week that the Prodiba contract was entered into the Nkobi books as R150m over five years .

Shaik had also prepared projected income statements and balance sheets to February 2008 assuming that the joint venture would secure the new a contract to supply 40000 devices.

However, the forensic investigation found no evidence that either Kobitech or Prodiba had a firm contract with the transport department.

"It can be concluded that the basis of the projections that were ostensibly presented to Symbol Technologies in support of the negotiations for the acquisition of the shares in Kobitech was founded on uncertainty and speculation," Van der Walt said.

Shaik has pleaded not guilty to two counts of corruption and one of fraud.

With acknowledgements to Nicola Jenvey and the Business Day.