Loading...

Eskom, McKinsey settle over R1bn fee

Jul 06 2018 17:53

McKinsey, Eskom and the Asset Forfeiture Unit (AFU) have reached a settlement regarding the controversial fee McKinsey earned from Eskom, McKinsey has said.

The settlement enables McKinsey to voluntarily return its fees for the 2016 Turnaround Programme, the management consulting firm said in a statement late on Friday afternoon.

Prosecutors had sought to recoup over R1bn in consultancy fees that they said were paid to McKinsey unlawfully.

"Eskom and McKinsey have been in discussions, along with the authorities, since the beginning of the year to ensure the fee would be repaid through an appropriate and transparent legal process," McKinsey said.

The fees would be repaid within five days of the Court order.

Saf Yeboah-Amankwah, Senior Partner at McKinsey, said: "McKinsey is thankful to have reached this milestone, which fulfils the commitment made last year to voluntarily return its full fee to Eskom. We appreciate the support of Eskom and the AFU in resolving this matter."

In June, Bloomberg reported that the AFU had filed the case against McKinsey in the North High Court in Gauteng.

At the time, the parties said they expected the matter to be settled "amicably".

McKinsey has consistently denied any wrongdoing, saying the fee repayment was as a result of Eskom not complying with procurement laws. The repayment is not an admission of liability, it said on Friday.

In December, the AFU obtained an order to freeze the money while negotiations around a settlement continued. However, negotiations reached a deadlock, and a seizure order was needed before the asset preservation order expired to ensure the money would be recovered, according to court papers.

On Friday evening, neither Eskom nor the AFU could immediately be reached for comment.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

Follow Fin24 on Twitter and Facebook. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication. We reserve editorial discretion to decide what will be published. Read our comments policy for guidelines on contributions.

afu  |  mckinsey  |  eskom
NEXT ON FIN24X

 
 
 
 

Company Snapshot

#SAVINGSMONTH

Five of SA's top financial brains, including SARB governor Lesetja Kganyago share their best savings habits.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Are you prepared for the latest round of Eskom’s load shedding??

Previous results · Suggest a vote

Loading...