Helios in court battle over Sh1.7b Telkom tender deal

Telkom Kenya’s new majority shareholder, Helios Investment Partners, has landed in the middle of a legal battle.

The British private equity company is now involved in a case over contracts worth Sh1.7 billion signed in April between Telkom Kenya and a Kenyan telecommunications equipment maintenance firm affiliated to China’s ZTE Corporation.

The equipment maintenance tender was advertised last year, and after considering the bids, Telkom decided signed a deal with Apex Vision.

But the agreement between the two companies went sour over the hiring of a project manager proposed by Orange’s chief technical and information officer, Jean Marie Garcia.

Performance review

According to court documents filed on November 17 by Apex’s lawyer, Charles Kihara, before High Court Judge Olga Sewe, Mr Garcia allegedly said the deal would only be effected once an Iranian national was absorbed into the firm.

Mr Kihara told the court an Iranian, a Mr Vahagn, was employed for three months, but was fired after a review of his performance. He said Apex did not renew the job contract over legal limitations on employing foreign nationals when there are locals with identical skills.

Vahagn was also said to have been unco-operative with the rest of Apex’s employees and would only take instructions from Garcia.

Justice Sewe also heard that Telkom had yet to pay Apex Sh262 million for works done over the last two months.

“The defendant has not made any payment that is due, owing now Sh262,000,000. As a result, the plaintiff continues to use its money to fund the project.”

Apex’s lawyer pointed out that the firm has incurred Sh373 million in expenses by entering into contracts with third parties.

The judge ordered that the status quo on the contract award be maintained until further orders from the court. She also ordered Telkom to compensate Apex for any losses it may lawfully suffer during the course of the case.

Telkom will respond to Apex’s charges on November 30.