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Johannesburg - Electronic payments company Net1 UEPS Technologies [JSE:NT1] has more time to continue carrying out a social grant tender amid a Constitutional Court decision to suspend a bidding deadline.
In April last year, the Constitutional Court ordered that the South African Social Security Agency (Sassa) re-issue the country’s R10bn grant tender, which was awarded to Net1 division Cash Paymaster Services (CPS) in 2012.
The Constitutional Court’s Justice Johan Froneman criticised Sassa for its “irregular” conduct regarding the Net1 deal. Net1 has previously faced allegations of bribing officials to win the contract. In addition, Net1 has also been criticised for selling products such as prepaid airtime and loans to social grant recipients.
Subsequently, Sassa issued a request for proposals (RFP) on 22 October 2014 regarding additional tender requirements. Conditions for the new social grant tender include prohibiting selling products such as prepaid airtime and loans to recipients.
But Net1 has opposed several tender specifications, alleging that they were “not sufficiently clear regarding a number of critical points and failed to comply with the request for proposals (RFP) requirements specified in the court’s order”.
And Net1 on Thursday said the Constitutional Court has ruled that “the original deadline of February 27, 2015 for the submission of bids is suspended pending determination” of several “issues”.
These issues, according to a Net1 market update on the Johannesburg Stock Exchange (JSE), include:
"1. The litigating parties are directed to file short written arguments by March 6, 2015 on the following issues:
a. Whether an extension to allow for the further amendment of the amended Request for Proposal (“RFP”) filed on December 20, 2014, arising from any legislative change to the legal framework existing when the remedial order granted by the Court was made, is competent; and
b. If not, the parties’ final submissions on the validity of the amended RFP.
2. The matter is set down for a hearing on these issues on March 19, 2015."
Net1 has previously indicated that it intends to re-apply for the social grant tender when bids are submitted.
Apart from being listed on the JSE, Net1 is also present on New York’s Nasdaq. Net1’s share price on the JSE hit a five-year high this week of R157.
