Johannesburg - Construction company Sanyati Holdings [JSE:SAN] has to
be liquidated due to corruption and incompetence in provincial and municipal
government, Business Day reported on Wednesday.
Malcolm Lobban, who resigned as Sanyati CEO last month, told
the paper that corruption and incompetence had forced the listed company out of
business rescue proceedings.
The company had not been paid by government departments in
the Free State, KwaZulu-Natal, and Limpopo.
The Free State roads department had accused contractors of
shoddy work and corruption, and had refused to pay.
"Allegations that our work was shoddy are completely
unfounded. It is corruption and incompetence, and if I had to choose one over
the other, I would say corruption," Lobban told Business Day.
Sanyati Holdings employs about 2 500 permanent and temporary
staff and would soon be liquidated.
Late last year the Treasury placed the Free State roads
department, most departments in Limpopo and some in Eastern Cape under national
administration.
Lobban said this had not helped as it had led to payments to
service providers being suspended.
According to Business Report Sanyati had been excluded from
a settlement agreement between the Free State provincial government for
outstanding claims by other contractors - Wilson Bayly Holmes - Ovcon [JSE:WBO],
Raubex [JSE:RBX], and Basil Read Holdings [JSE:BSR].
Lobban said Sanyati had an 18-month outstanding claim of
R43m against the Free State roads department, after having received R14m in
part payment late last year.
Free State roads department spokesperson Zolile Walaza said
there was a difference between the amount Sanyati claimed was completed and the
amount contained in a report by technical experts.
He told Business Day the department would meet Sanyati on
Thursday to "try and convince (them) to accept the settlement".