The value of a Transnet contract awarded to information technology (IT) company T-Systems ballooned from just under R1.7bn to nearly R3bn after known Gupta associate Salim Essa allegedly became a backchannel “negotiator” for the German multinational.
Former Transnet chief financial officer (CFO) Anoj Singh, who has come under fire for his ties to the Guptas, also allegedly played a key role in Transnet’s decision to extend T-Systems’ contract instead of putting it out to tender.
T-Systems’ initial five-year contract to supply Transnet with IT data services was supposed to have come to an end in 2014. But the contract was extended for a period of two years, a decision that earned the company nearly R1.3bn in additional revenue.
And thanks to an ongoing dispute over the contract, the company will earn up to R900m in further revenue while the row drags on, according to T-Systems’ own records.
By the time the latest contract extension expires in May 2018, T-Systems will, therefore, have earned just under R4bn from a 2010 contract valued at only R1.7bn.
T-Systems has admitted to News24 that it considered appointing Essa as a “sales agent” in 2014, but the company says it eventually decided against it.
T-Systems also strongly denies that Essa influenced or played any role in Transnet’s handling of the data services contract, or that it ever paid Essa to represent the company in relation to any of its work with Transnet.
But sources familiar with the interactions between the IT firm and the parastatal say that Essa in 2013 and 2014 attended meetings with Transnet staff as a “negotiator”, supposedly on behalf of T-Systems.
During this time, Transnet was not only considering putting the IT data services contract up for tender but was evaluating a tender for network services.
The latter contract ultimately landed rival IT firm Neotel in an embarrassing kickbacks mess involving Gupta-linked “letterbox” company Homix following a series of exposés by amaBhungane.