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Cape Town - A former Eskom employee allegedly used his position at Eskom to award his own company a service contract – the value of which currently runs to about R65m – while using Eskom's infrastructure, vehicles and equipment to deliver electricity services in Khayelitsha.
This is according to court documents in a civil case brought by Eskom against Dave Malherbe of Gordons Bay in the Western Cape High Court.
According to affidavits by Eskom top officials, PN Energy Services (PNES) was a company 100% owned by Eskom.
PNES was established in 1993 and in 1994 started to operate as an entity managed by Eskom, Electricité France and East Midlands Electricity.
Eskom subsequently obtained sole ownership of PNES. Malherbe, an Eskom employee, was appointed managing director in 2002. The parastatal also appointed other employees as directors on the PNES board.
Around 2007/08 Eskom appointed a technical team to incorporate the PNES business into Eskom and close PNES down.
The parastatal also set up a “PN integration team”, which had a meeting with Malherbe and the rest of the PNES board in 2008.
Although Malherbe had for months been aware that Eskom was going to dismantle PNES, on December 3 2008 he took over a shelf company called Bold Moves as sole shareholder and owner.
On December 10 2008, at a PNES board meeting, Malherbe delivered a presentation on a contract that PNES should enter into with Bold Moves – whose name was subsequently changed to Energy Utility Services.
The only other directors of PNES at that stage were Peter Sebola, who had been appointed in February 2008, and Jacob Machinjike, who the chair and had been appointed to the board in October 2005. Both were Eskom employees, as stated in the court documents.
Although the minutes indicate that Malherbe had declared his "interests", it was unclear to what extent he had declared them and whether he had recused himself from the decision on the Bold Moves contract, according to an affidavit by Eskom manager Ohna Smit.
The minutes were also marked “strictly confidential”.
At a subsequent PNES board meeting on January 14 2009 it was resolved that PNES’s core and non-core functions should be outsourced to Bold Moves (EUS).
Sebola and Machinjike, the only directors of PNES other than Malberbe, admitted to Michelle Moodley and Bouts Wagener of Eskom’s forensic team that they had not known whether the contract complied with the PNES tender requirements. PNES’s tender committee had at that stage consisted of three people, but had been headed by Malherbe.
Only on January 27 2009 had Eskom’s management become aware that an agreement had been entered into between PNES and EUS.
Conflict of interest
Eskom argued that PNES, in the light of Eskom's plans to shut it down, should have informed the utility’s management of any contracts entered into.
On February 23 2009 Eskom’s forensic team was informed of Malherbe’s actions. On March 5 that year Malherbe tendered his resignation from the parastatal, and on March 31 he resigned as a director of PNES.
Between April 2009 and January 2010 PNES paid Malherbe’s EUS almost R65m.
Eskom submits that the contracts with Malherbe’s EUS had been "irregular" and a direct and significant conflict of interest.
Eskom also alleges that Malherbe failed to fulfil his fiduciary obligations and there was no disclosure of his interests.
The written disclosure of interest that Malherbe completed on January 20 2009 took place more than a week after the contracts with EUS had been concluded.
For more than a year Eskom has been attempting to take possession of various substations, parts, construction equipment and vehicles used in the Khayelitsha area.
According to Malherbe the case had dragged on for 16 months and in his view a valid contract had been concluded, which should proceed.
He also mentioned that he was not aware of any investigation by either the Hawks or any other institution.
Sake24 recently established that the Hawks were indeed investigating the PNES issue, as well as other allegations of corruption at Eskom.
Three sources close to Eskom and the National Prosecuting Authority confirmed that the investigation was not limited to the Western Cape but extended countrywide.
Judgment in the matter before Judge Burton Fourie is expected within days.
- Sake24.com
For business news in Afrikaans, go to www.sake24.com.
This is according to court documents in a civil case brought by Eskom against Dave Malherbe of Gordons Bay in the Western Cape High Court.
According to affidavits by Eskom top officials, PN Energy Services (PNES) was a company 100% owned by Eskom.
PNES was established in 1993 and in 1994 started to operate as an entity managed by Eskom, Electricité France and East Midlands Electricity.
Eskom subsequently obtained sole ownership of PNES. Malherbe, an Eskom employee, was appointed managing director in 2002. The parastatal also appointed other employees as directors on the PNES board.
Around 2007/08 Eskom appointed a technical team to incorporate the PNES business into Eskom and close PNES down.
The parastatal also set up a “PN integration team”, which had a meeting with Malherbe and the rest of the PNES board in 2008.
Although Malherbe had for months been aware that Eskom was going to dismantle PNES, on December 3 2008 he took over a shelf company called Bold Moves as sole shareholder and owner.
On December 10 2008, at a PNES board meeting, Malherbe delivered a presentation on a contract that PNES should enter into with Bold Moves – whose name was subsequently changed to Energy Utility Services.
The only other directors of PNES at that stage were Peter Sebola, who had been appointed in February 2008, and Jacob Machinjike, who the chair and had been appointed to the board in October 2005. Both were Eskom employees, as stated in the court documents.
Although the minutes indicate that Malherbe had declared his "interests", it was unclear to what extent he had declared them and whether he had recused himself from the decision on the Bold Moves contract, according to an affidavit by Eskom manager Ohna Smit.
The minutes were also marked “strictly confidential”.
At a subsequent PNES board meeting on January 14 2009 it was resolved that PNES’s core and non-core functions should be outsourced to Bold Moves (EUS).
Sebola and Machinjike, the only directors of PNES other than Malberbe, admitted to Michelle Moodley and Bouts Wagener of Eskom’s forensic team that they had not known whether the contract complied with the PNES tender requirements. PNES’s tender committee had at that stage consisted of three people, but had been headed by Malherbe.
Only on January 27 2009 had Eskom’s management become aware that an agreement had been entered into between PNES and EUS.
Conflict of interest
Eskom argued that PNES, in the light of Eskom's plans to shut it down, should have informed the utility’s management of any contracts entered into.
On February 23 2009 Eskom’s forensic team was informed of Malherbe’s actions. On March 5 that year Malherbe tendered his resignation from the parastatal, and on March 31 he resigned as a director of PNES.
Between April 2009 and January 2010 PNES paid Malherbe’s EUS almost R65m.
Eskom submits that the contracts with Malherbe’s EUS had been "irregular" and a direct and significant conflict of interest.
Eskom also alleges that Malherbe failed to fulfil his fiduciary obligations and there was no disclosure of his interests.
The written disclosure of interest that Malherbe completed on January 20 2009 took place more than a week after the contracts with EUS had been concluded.
For more than a year Eskom has been attempting to take possession of various substations, parts, construction equipment and vehicles used in the Khayelitsha area.
According to Malherbe the case had dragged on for 16 months and in his view a valid contract had been concluded, which should proceed.
He also mentioned that he was not aware of any investigation by either the Hawks or any other institution.
Sake24 recently established that the Hawks were indeed investigating the PNES issue, as well as other allegations of corruption at Eskom.
Three sources close to Eskom and the National Prosecuting Authority confirmed that the investigation was not limited to the Western Cape but extended countrywide.
Judgment in the matter before Judge Burton Fourie is expected within days.
- Sake24.com
For business news in Afrikaans, go to www.sake24.com.
