Prasa boss ‘knew’ rail contract would be a train wreck
E-mails suggest Montana was made aware of looming pitfalls
FORMER CEO Lucky Montana allegedly withheld crucial and damning information from the board of the Passenger Rail Agency of South Africa about the dodgy company that won the controversial multibillion-rand locomotive contract.
E-mails attached to court papers lodged by the board’s chairman, Popo Molefe, last week show how the contract, won by Swifambo Rail Leasing, set off alarm bells three years ago.
In one e-mail, dated November 2012, former board member Bridgette Gasa told Montana: “I have just received intelligence information about Swifambo Rail Leasing . . . failure to follow this up would sink the organisation.”
Molefe wants the High Court in Johannesburg to set aside the R4.8-billion contract, won by a joint venture between Swifambo and Spanish locomotive manufacturer Vossloh España.
According to Molefe, just days before the contract was awarded to Swifambo, evidence was brought to Montana’s attention that the company was not in good standing.
Molefe said an e-mail sent on June 21 2012 by then-financial officer Fenton Gastin indicated that there were problems with Swifambo, a company owned by former senior government employee Auswell Mashaba.
“Supply chain management findings are quite serious . . . Issues included contracts not signed, copies of supplier tax clearance certificates not on tender files, tender minutes not signed, tender documentation not signed,” read the e-mail.
Molefe has submitted the e-mails and other correspondence to show that Montana deliberately withheld information from the board.
“It appears from the e-mails obtained during the investigation that problems with the procurement process were identified by other employees within Prasa and brought to Montana’s attention before the board approved Swifambo as the preferred bidder,” Molefe in an affidavit.
The Afro 4000 trains built by Vossloh turned out to be unsuitable for the local rail network because they were too high and could have interfered with overhead powerlines.
The Prasa board wants the Spanish company to take back the 13 locomotives already delivered and to refund the R2.65billion already paid to it.
According to Molefe, Swifambo — which, he said, was formed specifically for the multibillionmember
said HOT SEAT: Former Prasa CEO Lucky Montana; below, one of the e-mails cited in the court case rand deal — was assessed on the experience and technical capabilities of Vossloh España, even though the two had no joint venture or any legal agreement in place during the bid process.
He alleges that there was tender-rigging and that Swifambo should have been disqualified from the beginning.
“I emphasise that these issues were brought to Montana’s attention three days before the board approved the Swifambo bid. Montana attended the board meeting on July 24 2012 and refrained from pointing out any irregularities in the procurement process.
“The inference is that Montana was determined to proceed with the process that would result in the appointment of Swifambo as the preferred bidder. His motive for this is unclear and the investigations are still ongoing,” said Molefe.
Swifambo was appointed as the preferred bidder on July 27 2012.
Montana denied the allegations, telling the Sunday Times that there was no evidence to suggest that he had manipulated the tender process.
“Based on evidence Prasa has advanced, there is [nothing] linking me to rigging. I don’t deal with specifications . . . there is no evidence that I did a wrong thing on my side,” he said.
Prasa’s court action had no basis and was “vindictive”. “[It] is not winnable . . . it’s based on no facts. It is irresponsible. Each
Supply chain management findings are quite serious I know Popo was going for me, but there is no evidence
of the bid adjudication committee must be called to testify . . . If they had suspicion in 2012, why didn’t they raise that? They are going to find it difficult to win. I know that Popo was going for me, but there is no evidence. The whole application is speculative,” Montana said. Comment on this: write to tellus@sundaytimes.co.za or SMS us at 33971 www.sundaytimes.co.za