Mteto Nyati, Altron CEO (Pic supplied: Altron)
Mteto Nyati, Altron CEO (Pic supplied: Altron)

Altron to appeal court decision on Tshwane broadband contract

By Sandile Mchunu Time of article published Jul 18, 2019

Share this article:

DURBAN - JSE-listed Allied Electronics Corporation (Altron) said yesterday that the group would appeal the North Gauteng High Court decision to set aside the City of Tshwane’s Municipal Broadband Network Project contract.

Altron chief executive Mteto Nyati said the group was disappointed with the ruling as the project had between R40million and R60m estimated exposure to its business.

Nyati said Altron was studying the court judgment.

“Once we have consulted Thobela Telecoms and project funders, we will consider our next steps and we are not ruling out an appeal of the judgment,” Nyati said.

The court ruled that internal processes were not followed by the city in awarding the contract to Thobela Telecoms in 2015.

Thobela Telecoms is a special purpose vehicle (SPV) in which Altron Nexus, a subsidiary of Altron, has a minority shareholding.

Altron Nexus was involved as primary network designer and architect, supplier of broadband equipment and related services.

The financial model, provided solutions, and government regulations were investigated following the awarding of the contract, with the due diligence finding no shortcomings.

Altron is invested in telecommunications and information technology, offering ICT services in the areas of cyber security, software security solutions and business process outsourcing, among others.

“This considers our claims against Thobela Telecoms for infrastructure and equipment supplied so far,” Nyati said.

“Up to this point the City of Tshwane has not paid a cent of taxpayers’ money towards the project as we are in the build phase, which is being financed by our funders.”

Nyati said the matter relates to a dispute between Thobela Telecoms the special purpose vehicle and City of Tshwane on allegations that the tender award process was unlawful due to the internal processes and procedures were not followed correctly.

“Subsequent to being awarded, the project was put on hold by the City of Tshwane, pending the outcome of the court case.

“The court’s decision on July 16 was to set aside the awarding of the contract on the basis of internal processes not having been followed by the City of Tshwane in the awarding of the tender; in the decision of the Municipal Council to approve the terms and sign-off of the Build Operate and Transfer (BOT) agree- ment entered into between City of Tshwane and the SPV; and the waiver by City of Tshwane of the fulfilment of suspensive conditions precedent relating to the BOT agreement,” the group said.


Share this article: