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NRZ finally cancels DIDG tender

by Staff reporter
04 Aug 2020 at 08:11hrs | Views
THE National Railways of Zimbabwe has finally cancelled the US$400 million recapitalisation tender that had been awarded to the Diaspora Infrastructural Development Group (DIDG) in partnership with South African railway company, Transnet.

NRZ last year advertised a tender for the recapitalisation of its operations in the hope it would get a financier whose major task was to finance the revamp of its dilapidated infrastructure.

DIDG, a group made up of Zimbabweans in the diaspora, emerged as the winner of the tender. It undertook to pour US$400 million into the operations of the NRZ.

The deal has, however, failed to take off after the Transnet board was fired by South African President Cyril Ramaphosa for "secretly" conjuring up such a deal without the government's authority.

Reports also indicated that the new Transnet board that was eventually appointed, failed to ratify the deal leading the NRZ to raise questions around its execution.

In a letter dated 30 July, 2020 addressed to DIDG executive chairperson Donovan Chimhandamba, a copy of which the NewsDay is in possession of, outgoing NRZ general manager Lewis Mukwada said the railway company had decided to terminate its relationship with DIDG owing to a cocktail of operational reasons.

"Further to the foregoing, I wish to advise that having given due and careful consideration to the matter and contents of the correspondence from yourselves (as noted above), the NRZ is unable to proceed with the relationship with yourselves in respect to the above tender and has resolved to and hereby terminates same or/ and cancels the relationship and/ or the award of tender 6599:5642 for the recapitalisation of the NRZ to Transnet and DIDG," Mukwada wrote.

He cited the discontinuation of the DIDG/ Transnet marriage as one of the reasons that had effectively led to the cancellation of the deal.

"(Some of the reasons include) ... The collapse or coming to an end of the relationship between Transnet and DIDG as a consortium for purposes of participation in the implementation of the above tender.

"(They also include)...Failure by Transnet to secure and/ or submit proof of approval by their board and by their shareholder (to continue participating in the tender). As you will appreciate, Transnet and DIDG submitted a teaming agreement which formed the basis of their joint bid. The tender was, therefore, to Transnet and DIDG as a consortium/ team.

"There was never a tender award to either Transnet or DIDG as a single and/ or independent entity," reads the letter in part.

Chimhandamba told NewsDay from his South African base that DIDG had, indeed, received the notification of intention to cancel the tender by the NRZ.

"We received the letter (of termination of the deal) on Thursday (last week)," said Chimhandamba.

"Needless to say we are disappointed by it considering the direct pressure the NRZ board, Lewis Mukwada (general manager) and management has faced from JB (Joel Biggie) Matiza (Transport and Infrastructural Development minister) over the last months to be complicit with an illegal act or they face immediate fast-tracked retrenchment or removal based on trumped-up charges.

"Our lawyers, Atherstone and Cook, represented by Mr Innocent Chagonda, are studying it and we will respond accordingly. As DIDG, we are here for the long term and we are determined to ensure that our shareholders, Zimbabweans and the diaspora get what is rightfully theirs," Chimhandamba said.

Asked whether the NRZ was not opening itself to a legal battle with DIDG on the matter, Matiza said there was "ample ground" to defend the cancellation of the deal.

"If anyone wishes to go through a neutral arbiter in cases of disgruntlement over such cases, which is to go to court, they are free to do so. This deal's cancellation was done within the confines of the law and there is ample legal ground to defend the action taken thereof," said Matiza during a Press conference in Bulawayo on Friday.



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Source - newsday

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