JOHANNESBURG- Technology giant EOH and five of its executive directors have been blacklisted from doing business with the government after the National Homebuilders Registration Council (NHBRC) and the National Treasury placed the company on the database of restricted suppliers.
Although all parties involved are trying to keep the situation under wraps, Africa News 24-7 can exclusively reveal that the NHBRC requested for EOH and five of its directors to be blacklisted from doing business with government and related agencies due to a breach of contract.
The five members of its executive team who are implicated in the dispute are Robert Durban Godlonton, Ebrahim Aboobaker Laher, Jehan Mackay, Zunaid Mayet and Dion Dominic Ramoo.
Coincidentally, when Africa News 24-7 sent questions to the National Treasury, NHBRC and EOH, the name of the company and five of its directors were subsequently removed from the list. However, Africa News 24-7 is in possession of the original list where it clearly states that EOH and five of its directors are blacklisted by the NHBRC and National Treasury for breach of contract.
The blacklisting has subsequently led to a massive restructuring process within the company. In what appears to be a demotion after a series of scandals that saw the company’s share price plummet to record lows in recent months, EOH, in a SENS release announced that Mayet would relinquish his role as group CEO of the tech conglomerate to take on a position as CEO of NEXTEC, another lesser subsidiary belonging to the company.
The company said it is looking for a new a CEO of EOH Holdings to assume Mayet’s role and speculation is rife that the company may look to fill this position with a black female which has been the trend recently for troubled corporate entities in South Africa.
“The Board is in the process of finalising the appointment of a CEO for EOH Holdings,” said the company.
EOH had also bid for ICT contracts at SA’s power utility Eskom that were valued at R2 billion. After allegations of corruption surfaced, some senior executives at Eskom were placed on suspension following the developments.
Khulu Phasiwe, Eskom’s National Spokesperson said the utility was aware of the blacklisting at National Treasury.
“Yes, we saw the list from the National Treasury website on 13 June 2018.”
Africa News 24-7 also sought to establish whether EOH was still in the running for the ICT contracts despite the blacklisting.
Phasiwe responded: “Given that we are currently in a commercial process and that there are various investigations underway, Eskom is not in a position to make any comments on this matter at this stage. The Hybrid Programme was put on hold on 13 April 2018 until the investigations are completed. Eskom has not met with any potential suppliers.”
The NHBRC also confirmed and said its dispute with EOH was contractual. An anonymous source, close to the developments between EOH, National Treasury and NHBRC said the five directors named from EOH had colluded amongst each other to try and defraud the NHBRC, a claim which the latter organisation denied.
Another tip-off also alleges that a contract between EOH and multinational technology group IBM has also been terminated as a result of EOH being implicated in a serious breach of contract with the NHBRC. This breach of contract with the NHBRC is said to have required extensive intervention at the highest level from the National Treasury.
When pressed for comment, the NHBRC said the company would not be able to divulge information despite there being a high possibility of public funds being exploited. Usually, companies that get blacklisted on the National Treasury’s database of restricted suppliers are businesses that have done work for the government or state agencies.
The bans last for about five to ten years and the crimes committed by some of the companies on the database range from poor performance, collusive bidding, misrepresentation of information, conflict of interest, fraud and the submission of fake Black Economic Empowerment certificates.
Tshepo Nkosi, the Spokesperson of the NHBRC said: “The matter between EOH and the NHBRC is of a commercial contractual nature. We wish to place it on record that there are no issues relating to fraud committed against the NHBRC. The three parties NHBRC, EOH & National Treasury are currently in negotiations at the highest level to resolve the matter. We are unfortunately not in a position to divulge any information at this point,” he said.
When approached for comment, IBM’s head of communications Naniki Mahlong did not respond to detailed questions, only commenting: “As IBM we do not disclose our private business with clients.” African News 24-7 had sent her the following the questions:
1.) Did you terminate the contract with EOH as a result of this blacklisting?
2.) What was the nature of your business with EOH?
3.) What was the monetary value of your contract with EOH
4.) Are you aware of various allegations of corruption that have been levelled against EOH? Please comment on this?
5.) Why did you cancel the contract with EOH?
A set of questions were also sent to National Treasury. The department directed key questions to the NHBRC and could not disclose why or who authorised the removal of EOH on the database of restricted suppliers, especially right after a media query was sent seeking more information about the blacklisting.
After EOH was approached for comment, the company, through its lawyers Nicqui Galaktiou INC told a different story. While Eskom and NHBRC confirmed the blacklisting, EOH lawyers vehemently denied that it had been placed on the database of restricted suppliers despite the glaring evidence stipulating otherwise.
The company explicitly said none of its legal entities, which amount to over 120, nor any of its directors are blacklisted by National Treasury. However, Africa News 24-7 established that this was false as the NHBRC confirmed that it had requested EOH to be blacklisted as a result of a contractual breach.
The company further commented: “We invite you to provide us with any evidence upon which you rely, other than unreliable information from anonymous sources…Our client has consequently instructed ENSafrica to conduct an independent investigation to uncover and expose any persons/entities that are intentionally trying to target it through the media. Our client is dedicated to investigating and ascertaining who and what is motivating and fuelling these media attacks.”
The company also tried to muzzle journalists at Africa News 24-7 with threats of criminal charges if they continued asking questions. It demanded journalists investigating stories related to the technology group to divulge their sources which goes against standard journalistic principles.
“Considering how seriously our client is taking the matter, please urgently provide us with the contact details of all the relevant parties to enable us to inform them of the risk that they face as a result of your persistent and deliberate intention to destroy our client’s reputation and jeopardize its business. Please note that the legal process will be served on all parties personally, or if a corporate entity, at its registered office,” the company said through its lawyers.