[kictanet] It's a new twist for Econet Wireless

Sat Jul 28 18:43:39 EAT 2007

Mike,

One would hope that our hard-working team at the Ministry dont get mired
in the Econet charade, and will do their homework to make sure that Kenyan
Farmers dont get short-changed like the Nigerians, although they did learn
their lesson and took corrective measures thereafter.

Alex, fancy taking up the role of the "people's watchdog" since the media
has clearly been compromised on this one!  CNN has Anderson Cooper keeping
the Government honest, so I hope you can step in!

LK

> One cannot envy the PS for he is in a difficult situation trying to
> extricate the government from a situation which would never have occurred
> had those responsible (long before the tender concluded) abided by the law
> and struck out the litigant based on publicly and widely available
> information during the pre-qualification stage of the tender. Even though
> some might disagree, two wrongs do not make a right, and history no matter
> how long it takes to get there will be the judge of this government's
> actions. As was the case, while the Government was fighting the litigant
> in
> Kenyan courts, a different arm of the Government was bizarrely engaged in
> a
> PR campaign on behalf of the litigant in a foreign country! Was the
> litigation in Kenya a mere public relations exercise to show Kenyans that
> the government tried to do something so that Kenyans could mistakenly
> conclude that atleast the government 'fought tooth and nail' ?
>
> The government cannot claim to know it did not know what kind of 'animal'
> it
> was dealing with when it allowed the litigant to get past
> pre-qualification
> while international telecom giants with more experience, cash and
> expertise
> in African countries were knocked out. A long time back in 2001, some of
> Kenya's best and brightest technocrats investigating the litigant's
> attempt
> to purchase Telkom Kenya went on a due diligence expedition (something the
> regulator should have undertaken). The delegation included: Mwaghazi
> Mwachofi (Treasury PS), Francis Muthaura, Esther Koimet (Investment
> Secretary), Augustine Cheserem (TKL), Dan Ameyo (AG Chambers), Mr Davis
> Chirchir (TKL). This delegation compiled a report which should be made
> available to the public and which explains in part the litigant's current
> attempts to obtain the licence without paying in full for it (part of its
> modus operandi). Per the Daily Nation, Business Week of November 27, 2001
> some of Kenya's brightest minds found that:
>
> --------------------
>        Although this, on the face of it, would appear to be a moot point,
> the
>        undercurrent would appear to be a suspicion that the South African
> company's
>        plan was to borrow funds from the financial market using Telkom
> Kenya's existing
>        balance sheet.
>
>        In the team's view, this was an inequitable arrangement, the
> argument
> being that
>        the South Africans wanted to reap where they did not sow.
>
>        According to informed sources, the final conclusion of the report
> was
> even more
>        controversial.
>
>        "These people have categorically stated in their report that the
> government
>        should not have pre-qualified the Mount Kenya Consortium in the
> first
> place," a
>        key insider confided to BusinessWeek.
> -----------------------
>
> If one walks into a bank and fraudulently obtains a Ksh 10 million loan,
> they are liable to possible prosecution for the illegal procurement of the
> loan through fraud, misrepresentation and false pretences. The bank can
> recall the loan, and it can also seize the individual's collateral in
> addition to pursuing civil and criminal actions against the individual.
> The
> cases against the government were cases to be won by the Government and
> not
> the litigant, vast information proving misrepresentation at the
> pre-qualification stage, collaboration in planning the tender and
> throughout
> the course of the tender is in the public domain. All the Government
> needed
> to do is provide proof of these actions (of which there is plenty
> including
> through KACC investigations). Just one instance indicates that the tender
> committee moved the technical evaluation date of the tender such that the
> ITU (International Telecommunications Union) representative and observer,
> Mr. Ricardo Passerini, who was to be an observer was not present to
> observe
> the process. Unlike Kenya, the Morocco tender which raised over $1bn+
> fully
> engaged the ITU in its tendering process and is held up as an example of
> successful and transparent tender. Can the same be said of the Kenyan
> tender?
>
> The second case against the Minister was also winnable. Parliamentary
> privilege protected what he said. Secondly what he said was perfectly true
> and provable in any court through thousands of documents and through
> obtainable testimony by the litigant's own insiders and former employees.
>
> Perhaps the Attorney General's qualified opinion on these matters which
> was
> presumably obtained should be made public or discussed in parliament or
> released by the PS for the air to be cleared once and for all so that
> Kenyans can understand how these cases could have been lost in the face of
> overwhelming evidence, certified financial audits of the litigants
> demonstrating they did not meet the tender requirements amongst several
> other defence mechanisms the government could have utilised and obtained
> to
> win its cases.
>
> Incase there is any lingering doubt about the existence of a modus
> operandi
> by the "seasoned and very experienced" litigant one only needs to look at
> the similarities between the KNFC situation (abandoning agreements) and
> the
> Altech partnership situation:
>
> -------------------
>           The CEO of Altech, Mr Craig Venter, says over the past three
> months Altech has
>           exhausted every avenue possible to find an amicable solution
> with
> Econet. Altech
>           therefore had no alternative but to resort to the just and
> equitable winding up
>           application after Econet purported to cancel the shareholder's
> agreement and
>           then took other steps designed to weaken Altech's position
> within
> the joint
>           venture.
>
> http://www.altech.co.za/content/news_corporate_display.asp?sCompanyName=altech&sNewsArticleID=35
> -------------------
>
> As to the possible claims about 1-2m subscribers, its just an extension of
> the modus operandi used by the litigant in several other countries. In
> Papua
> New Guinea they purported to offer a minuscule $48m for the National
> Operator, later when they went to court against the PNG government, they
> sued for $1bn claiming this was what the operator would have been worth to
> them!! Needless to say the case did not go far, a sovereign government has
> the inalienable right to accept or reject a bid which it rightly did.
> Kenyans should learn not to succumb to an entity whose track history shows
> it has not won any of its massive lawsuits except the one lawsuit that
> enabled them to start business in Zimbabwe.
>
> On 7/25/07, Bill Kagai <mediacorp.research at mediacorp.co.ke> wrote:
>>
>>
>> This is a murky area by any standards, but the PS made it abundantly
>> clear, that the Govt opted to discuss the specific cases initiated by
>> Econoet against itself....
>> The rest [KNFC et al] according to my understanding are still in court.
>>
>> You can imagine, if Econet won some cases against Govt and then
>> estimated
>> they would at least have had 1-2 million subscribers [if they did not
>> have
>> to go to court] then settlement would turn into billions of my and your
>> money as taxpayers. Its the best way out of this quagmire.
>>
>> Bill Kagai
>>
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