Sta­dium bat­tle looms

R429.4m Green­point Sta­dium dam­ages claim to pro­ceed soom

Weekend Argus (Sunday Edition) - - SPORT - Roy Cokayne

THE CITY of Cape Town is ready to pro­ceed with its R429.47 mil­lion civil dam­ages claim against listed con­struc­tion groups WBHO, Aveng and Ste­fanutti Stocks on the Green­point Sta­dium. Deputy executive mayor Ian Neil­son told Business Re­port that the city was now await­ing a court date for the case after it had filed its amended par­tic­u­lars of claim in April.

The dam­ages claim re­lates to col­lu­sion by the three com­pa­nies on the ten­der for the de­sign and con­struc­tion of the sta­dium for the 2010 World Cup.

In March, WBHO failed in its High Court ap­pli­ca­tion to amend the city’s par­tic­u­lars of claim.

Neil­son said WBHO had com­plained that the city was re­ly­ing on ad­mis­sions made by Aveng and Ste­fanutti Stocks to the Com­pe­ti­tion Com­mis­sion to sus­tain its claim against WBHO, the only re­spon­dent that ob­jected to the pro­posed amend­ments.

Neil­son said the city be­lieved that its reliance on the ad­mis­sions made by Aveng and Ste­fanutti Stocks, in­clud­ing an agree­ment in re­spect of in­flated profit mar­gins charged to the city, was en­tirely per­mis­si­ble.

The case stemmed from ad­mis­sions made by sev­eral listed con­struc­tion groups in con­sent set­tle­ment agree­ments reached with the Com­pe­ti­tion Com­mis­sion in terms of its fast­track set­tle­ment process.

The Green Point Sta­dium was among the projects listed by WBHO and Ste­fanutti in the set­tle­ment that was sub­se­quently con­firmed by the Com­pe­ti­tion Tri­bunal in 2013.

Both com­pa­nies ad­mit­ted that they had reached agree­ment with Group Five in De­cem­ber 2006 to pro­vide a cover price for this pro­ject to en­sure that Group Five did not win the ten­der. Ste­fanutti Stocks ad­mit­ted re­ceiv­ing a cover price from WBHO to en­sure that it could sub­mit a non-com­pet­i­tive bid and en­sure that WBHO was awarded the ten­der.

The ten­der was awarded to the Mur­ray & Roberts (M&R)/ WBHO joint ven­ture and the pro­ject was com­pleted in De­cem­ber 2009.

Aveng’s con­sent set­tle­ment agree­ment in­cluded the 2010 World Cup sta­dium agree­ment. It ad­mit­ted that dur­ing or about 2006, Gri­naker-LTA, part of Aveng, WBHO, M&R, Group Five, Con­cor, Basil Read and Ste­fanutti had met twice and reached agree­ment on the con­struc­tion of the 2010 World Cup sta­di­ums.

In terms of that agree­ment, Aveng ad­mit­ted that th­ese firms had agreed to al­lo­cate the Mbombela, Pe­ter Mok­aba, Moses Mab­hida, Soc­cer City, Nel­son Man­dela Bay and Green­point ten­ders among them­selves and to ex­change cover prices.

Aveng ad­mit­ted that th­ese firms had fur­ther agreed that they should aim to ob­tain a 17.5 per­cent profit mar­gin in all the projects.

WBHO’s set­tle­ment agree­ments did not in­clude the 2010 World Cup sta­di­ums meet­ing and the com­pany had pre­vi­ously in­di­cated it did not be­lieved the meet­ings were a con­tra­ven­tion of the Com­pe­ti­tion Act.

The sta­di­ums meet­ing case is still pend­ing.

WBHO also said pre­vi­ously that it did not be­lieve the City of Cape Town had suf­fered any dam­age re­lated to the Green­point Sta­dium pro­ject and it had given notice of its in­ten­tion to de­fend the claim.

Ste­fanutti Stocks group chief executive Wil­lie Mey­burgh said this month that the civil dam­ages claim was only ex­pected to be heard to­wards the mid­dle or end of next year.

He added that the claim was the only Com­pe­ti­tion Com­mis­sion-re­lated mat­ter still hang­ing over Ste­fanutti and they were “com­fort­able that we can de­fend it”.

The City of Cape Town is await­ing a court date for its case against the con­struc­tion firms.

PHOTO: REUTERS

Cape Town’s Green­point Sta­dium. The City is poised for a court show­down re­lat­ing to col­lu­sion.

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