Laptop tender award sparks bitter partisan wars within Jubilee

The Sh24 billion laptop tender award has ignited vicious business wars within the Jubilee Coalition as faceless but politically connected businessmen who support different sides of the new government tear each other apart.

At the same time, details of how the government conducted the procurement of the 1.2 million laptops for Standard One pupils began to emerge amidst an anticipated bitter legal battle over the project after two losing bidders appealed.

The deal has also attracted the attention of the National Assembly with MPs planning to travel to China to investigate the ability of the company awarded the tender.

The procurement of the laptops, a major campaign promise by the Jubilee government, has attracted huge interest from both political and business circles locally and abroad as Kenyan pupils wait for the machines.

Losing bidders have alleged underhand dealings in the process that led to the award of the tender to India’s Olive Telecom PVT, which placed a joint bid with a Chinese company, New Century Optronics.

Key figures in the country’s business circles mentioned in connection with the tender on Saturday denied playing any role in the transaction.

Businessman Chris Kirubi defended himself from reports he is behind Haier’s bid in the multi-billion shilling tender.

“I am not involved in the laptop tender at all. What I know is that Haier contacted us at Centum Investments to help them establish a manufacturing centre in Kenya. I am very disappointed this will not happen now that they have lost the tender,” Mr Kirubi said.

DENIED INVOLVEMENT

Centum chief executive officer James Mworia confirmed the company was involved in talks with Haier to set up a big plant in Kenya but not to supply laptops to the government. “We were engaging with them in terms of investments. We knew that it was going to ensure massive creation of jobs in this country if implemented,” Mr Mworia said.

And Mombasa businessman David Langat, whose name has also been mentioned as an associate of one of the companies, also denied involvement.

“I am saddened by the level of gossip in the Kenyan media. Every time something happens, Langat’s name comes up. I don’t sell laptops or computers, please,” he stated.

The Sunday Nation also called the managing director of Amaco Insurance Company, Silas Simotwo, whose name has also been mentioned.

“I am shocked at that question. People who know me clearly will understand that I am not into IT business. This is mad speculation,” he said.

But Amit Mohindra of the BH Mohindra Company confirmed they were the local agents for the giant refrigerator makers Haier.

“We are the local agents for Haier in Kenya, and we have supplied their products locally before,” said Mr Mohindra.       

This transpired as members of the Education Committee in Parliament raised a red flag over the tender and asked for thorough investigations to avoid putting billions in public funds at risk.

“It is our strong opinion that the ministry must suspend any attempts to execute any contractual obligations to the awarded firm until all the issues raised have adequately been addressed,” said committee chairperson Sabina Chege.        

Olive Telecom quoted Sh24.6 billion followed by HP at Sh25 billion and Haier Sh25.1 billion.

Some of the big names mentioned in connection with the tender are said to have played conveyance roles in the tendering process, whose appeal is currently being processed by the Public Procurement Administrative Review Board.

ACCEPTED APPEAL

On Saturday, Sunday Nation established that the board had accepted the appeal by HP and will be setting up a date for hearing by mid this week in a process that could take up to 30 days.

In its application for review, HP, through Iseme Kamau and Maema Advocates, has raised six critical issues regarding the bid and want the tender awarded directly to them.

HP holds that Olive Telecoms should not have been awarded the tender: “In view of the fact that Olive is not an OEM (Original Equipment Manufacturer) its tender ought to have been rejected at the preliminary stage.”

Further the US company bidding from its European base in the Netherlands is challenging the use of Best and Final Offers (Bafo) negotiation arrangement, which it claims was a breach of Article 227 of the Constitution as it exposed the pricing units of the competing bidders prematurely.

HP states: “The procuring entity deliberately sought to obtain prices at artificial non-competitive levels and deprived the whole process of the benefits of free and open competition. As such the said disclosure also amounts to fraudulent practice contrary to section 41 of the Act.”

Other issues raised include claims that the procuring entity did not comply with the evaluation criteria set out in the tender document.

The company also claims that the process lacked transparency, adding that the criteria and procedure for negotiations was not provided for in the tender documents.

Further, HP has complained that there was an illegal variation of pricing contrary to clause 16 of the ITT, with the prices at the Bafo opening going higher for the lowest bidder instead of an anticipated decrease. HP is also aggrieved that value additions in the evaluations of their bid were not applied as offered, disadvantaging their application.

Haier also filled in their applications late Friday with their main complaint being that there was a major price variation which is against the Procurement Act.

Sunday Nation obtained confidential government documents detailing the minutes of the ministerial tender committee, the evaluation committee and due diligence report by the technical committee that travelled to China and India im January.

In the report the OEM is defined as “the company that owns the brand or trade mark or patent of the products produced”. It is in this category that HP, Olive and Haier are grouped. The three get supplies from a long a list of global device manufacturers, registered to deal only with OEMS.

On Saturday, Olive chairman Arun Khanna said his company is ready to roll out the project and described the legal tussle as unfortunate.