Publication: Business Day Weekender Issued: Date: 2006-12-02 Reporter: Rob Rose Reporter:

Transport Company Set to Sue Post Office

 

Publication 

Business Day Weekender

Date 2006-12-02

Reporter

 Rob Rose

Web Link

www.businessday.co.za

 

The SA Post Office, already under-fire for awarding suspect tenders, is set to be sued for a further R240m, this time by a company that is 25% owned by Investec Bank that claims it was suspiciously overlooked for a massive contract.

The contract, which expires in three years, involved handling all the Post Office’s postal road freight.

This is a significant matter for the Post Office, and could increase its liabilities significantly if the matter goes against it. It is also a sign of further turbulence at the parastatal, as this tender took place under the tenure of Post Office’s “Mr Clean", its CEO Khutso Mampeule, who was suspended two weeks ago.

Mampeule himself initiated a criminal charge against his predecessor Maanda Manyatshe over an alleged illegally issued tender and corruption. Manyatshe, who had taken over as MTN CEO recently, resigned his job over the allegations and has threatened to sue the parastatal and Mampeule for R100m. Communications Minister Ivy Matsepe-Casaburri last week mandated SizweNtsalubaVSP to probe all the suspect tenders.

CADE Transport, which claims it was overlooked for the tender, has lodged legal papers and the Post Office is expected to file their answering papers on Monday.

Cade’s executive chairman, Parmanathan Mariemuthu wants the entire tender process started from scratch.

According to Mariemuthu, CADE scored the highest during the “expressions of interest" phase of the tender with 85% but was later pipped to the post by a company, Crossroads Distribution, which was placed eighth (56%) in the initial tender phase.

SAPO got 18 responses to its invitation to tender, with seven bidders then asked to submit final proposals in the “request for proposals" phase.

Interestingly, Crossroads bid R344m for the contract ­ which meant the Post Office would have to pay R100m more for the same services. When pressed, the Post Office’s lawyers, Webber Wentzel and Bowens (WWB) said CADE had lost out on the grounds of “ability and experience" and “financial" factors.

Mariemuthu said this was awkward and demanded clarification given the fact that CADE’s bid was underwritten by Investec and was R100m cheaper. In addition, CADE operates 350 trucks, yet Crossroads only operates 41 trucks, which could be used to deliver post, he argued.

“I am at a loss as to how this could have happened," he said.

Minutes from a Post Office board meeting in the Weekender’s possession suggest that the appointment of Crossroads was part of a “deviation from tender" ­ ironically the same reason why Mampeule instituted criminal proceedings his predecessor.

Mariemuthu has raised other issues, including the fact that the appointment of Crossroads “significantly undermines the promotion of black economic empowerment" as Crossroads has a lower empowerment score than CADE.

WWB wrote back to Cade saying the complaint was an “attempt to raise your company’s failed tender, which failed on its merits, to an issue of public concern with significant implications requiring review aimed at restoring public confidence in tender processes is disingenuous and overstated".

WWB said the process was “exemplary" and “constituted a yard-stick against which all tender processes should be sought to be benchmarked".

With acknowledgements to Rob Rose and The Weekender.


This SAPO tender process seems to have been managed by the same people who managed the DoD's arms deal "tender" process. Or they learned their tricks from the same people at Shell House.

Reading this article is like deja vu.

SAPO even has the same attorneys as DoD.