Safaricom boss says tender losers are using blackmail

Safaricom chief executive Bob Collymore has raised the red flag on what he terms migration of “tender war barons” from the public sector to the private sector who are waging a smear campaign and filing multiple lawsuits after losing contracts.

Speaking about a petition filed to the National Assembly by a Mr Michael Ngugi alleging corrupt dealings at Safaricom, Mr Collymore questioned the motive behind the move, claiming there has been a lot of blackmail and intimidation by those who had lost contracts.

“Why is it that you can start to see quite a lot of activity around Safaricom in some of the respectable and less respectable publications? It feels to me like there is a bit of vendetta where people are trying to intimidate Safaricom and it would not surprise me if it would be disgruntled and unscrupulous businessmen who may not have got business because I stand firm,” said Mr Collymore.

He added: “I take a very firm position on integrity and I will never compromise on integrity ... you can intimidate as much as you want but I am still not going to compromise. So if unscrupulous businessmen are attempting to intimidate me either as a person or as a business, it is a futile exercise.” 

Mr Collymore’s comments mark the most aggressive response yet by a Kenyan company chief executive surrounding tender wars.

The petition filed on Thursday is accompanied by a leaked draft audit report done by accounting firm KPMG which was commissioned by the CEO to assist in streamlining operations in the company. 

On Thursday, the National Assembly Speaker told the House he had received a petition from Mr Ngugi regarding “malpractice and corrupt dealings” by the management of Safaricom.

“The petitioner contends that Safaricom Company Limited is a corrupt institution and there have been many cases of malpractices with regard to procurement of goods and services in particular tender processes, tender awards, unethical practices and governance,” said Mr Muturi.

The petitioner appealed to the National Assembly to swiftly recommend that the Ethics and Anti-Corruption Commission investigate the matter and take action against any official found culpable of malpractice and that a forensic audit be conducted in regard to all tenders by the operator awarded in the last two years.

“You will agree with me that the prayers sought by the petitioner are indeed justifiable before any court and may also be dealt with by the Public Procurement and Oversight Authority. However, Article 95 (2) which provides that the National Assembly deliberates on and resolves issues of concern to the people, obligates the House to also attempt to address such matters, with a view to resolving them,” said Mr Muturi.

Further, Mr Muturi directed the House Departmental Committee on Finance, Planning and Trade to consider the petition and report its findings within 60 days in accordance with Standing Order 227 (2). The move mirrors similar petitions done at the height of tender wars in government especially on the Standard Gauge Railway, primary schools laptop project and the port, which resulted in delays in the implementation.

It is only after the intervention by President Uhuru Kenyatta, warning parties involved of dire consequences and potential blacklisting of such tender barons, that matters cooled. The barons seem to have shifted to the private sector, according to players.

In the interview with the Sunday Nation on Saturday, Mr Collymore defended the company’s commitment to the fight against corruption within its ranks, stressing that his commitment had seen him rally other members of the private sector to join in.

“I was the first CEO to go public with the status of my finances. I am not a CEO who says we do not have any wrongdoing within my firm. We fire people every year,” said Mr Collymore.

He also addressed himself to the leak of the audit report by KPMG commissioned by the operator saying the move was suspect as it was done when the report was in its draft stages.

“We commissioned this report and have every intention to act on its findings. But the report was subject to discussions between me and my team as well as our business partners and hence should not be circulated publicly,” said Mr Collymore.

He said the company would take action on the report’s findings but would not make it public.

“If there are criminal acts in it, we will prosecute the suspects,” he said, adding that Safaricom has been in the forefront of pushing for the enactment of the anti-bribery law to punish those engaging in the vice in the private sector.

Safaricom announced full year results for the year ended March 31, 2015 showing a 38 per cent rise in profit after tax from Sh23 billion to Sh31.9 billion, with much of the growth coming from non-voice services.

Its total revenue increased 13 per cent to Sh163.4 billion, with the mobile giant’s customer base growing eight per cent to 23.3 million.