Denel-owned firm in tender dispute

Denel Group CEO Shaun Liebenberg. Photo:Nonhlanhla Kambule-Makgati

Denel Group CEO Shaun Liebenberg. Photo:Nonhlanhla Kambule-Makgati

Published Mar 8, 2013


Johannesburg - A company owned by Denel - the controversial South African state-owned parastatal at the centre of a multimillion-rand arms deal scandal - is embroiled in a tender dispute with another locally based firm.

The company, Mechem, is accused of reneging on its contractual obligations to pay the millions of rand it owes in proceeds to the Noble Company 1864 for tenders in former Cold War conflict zones.

The tenders were for the demining and clearing of land mines and other explosives, and the training of explosive-detection dogs in Angola and Namibia.

Noble also alleged that Mechem had colluded with one of its partners in Noble, Dr Bruce Peck, to include the son of its chief executive, Ashley Williams, and the wife of another of its executive members, as shareholders in Noble.

Mechem, which was established during the apartheid era, is the firm that was involved in the planting of millions of landmines in Angola, Namibia and Mozambique.

It entered into a partnership with Noble to acquire the Angolan and Namibian contracts because of its tainted history in these countries.

Noble is owned by Mandla Msimang, son of former ANC treasurer-general Mendi Msimang, and Joseph Shaka Nkadimeng, who is related to late ANC stalwart John Vernon Nkadimeng, South Africa’s first ambassador to Cuba.

In terms of the contracts between the two companies, which The Star has seen, Noble was “to source business opportunities for Mechem globally”.

In 2010, Noble successfully facilitated the securing of the Angolan contract from Sonangol Projects, an Angolan parastatal that oversees the production of petroleum and natural gas reserves.

In return, Mechem was to pay Noble a commission fee of 10 percent of the proceeds for carrying out their duties in Angola. The contract was worth R24m a year for five years, and Noble was entitled to R2.4m each year.

With regard to the Namibian contract, Noble managed to secure the tender for the training of that country’s police bomb squad unit and the supply of explosive-detection dogs on behalf of Mechem. Noble was entitled to 50 percent in agreed fees, worth R2.4m, including additional goods.

The Star has seen copies of both the Namibian and Angolan contracts, which clearly indicate the terms of the agreement and both parties’ role in the deal.

According to Nkadimeng, the deal turned sour when he discovered some irregularities in the Noble shareholding structure. He alleged that Williams’s son and the wife of another Mechem executive member, Johan Coetzee, had been fraudulently added as shareholders by Noble chief executive Peck.

A company check at the Companies and Intellectual Property Registration Office confirmed that Williams’s son and Coetzee’s wife had been registered as shareholders, Nkadimeng said.

“When I confronted Dr Peck and Mr Williams, they denied and labelled me ‘a bad apple’ and (said) my behaviour was unacceptable,” he said.

Nkadimeng has since opened a case of intimidation and attempted murder against Peck on December 23, 2011, after he received telephonic death threats.

It was then that Nkadimeng started demanding payment in outstanding fees.

In a typical calculated move to “explode” Noble’s fees, Nkadimeng claimed that he received confirmation from Mechem chief financial officer Gerrie Nel that Sonangol had paid the R24m it owed to Mechem via its Angolan agent, VanGuard.

Despite confirmation of this payment, Mechem refused to pay Noble its 10 percent commission fee, Nkadimeng said.

Contacted for comment this week, Mechem denied the existence of a Sonangol or the Namibian contracts with Noble.

“We have formally informed our company’s attorneys that such claims will be contested in court,” said Denel spokeswoman Pamela Malinda.

Peck denied that he had made any death threats against Nkadimeng.

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The Star

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