Kasukuwere awarded Brainworks gvt advisory, $100m deal , without tender

PRIVATE equity group, Brainworks Capital, expected  to earn a healthy $100 million when it was contracted to advise the government in its bid to force foreign mining companies to comply with the country’s indigenisation laws.

The company was awarded the deal by a department in the empowerment ministry then headed by Saviour Kasukuwere without going to tender.

“It’s not our duty to know whether there was supposed to be tenders or not,” Brainworks’ chief executive, George Manyere, told a parliamentary committee probing the deal last week.

Brainworks was contracted by the National Indigenisation and Economic Empowerment board (NIEEB), a government department whose boss was ultimately Kasukuwere as the then indigenisation minister.

At the time Kasukuwere doggedly led the charge, against vociferous criticism from within and outside Zanu PF, to force the platinum mining firms to cede 51 percent equity to locals and donate millions of cash to community development schemes in line with Zimbabwe’s indigenisation laws.

Before he was moved from the ministry, Kasukuwere claimed success in the mining sector and was vowing to target foreign banks next, resulting in public spats with then central bank governor Gideon Gono.

But Manyere told legislators that, contrary to Kasukuwere’s claims, all the major mining deals were never concluded and that his firm did not earn the $100 million it had expected.

Manyere admitted that the contract was not put to tender, but said that was not Brainworks’ problem.

“That is the baby of NIEEB. Us, as Brainworks, we can only talk about our mandate and whether we executed it properly or not,” he said.

The company was contracted to advise NIEEB on the indigenisation compliance of platinum miners  and gold producer Blanket Mine as well as South Africa-owned Pretoria Portland Cement.

Brainworks expected to pocket not less than $17 million from the Zimplats deal and over $10 million from the Mimosa contract.

Curiously however, NIEEB asked the miners to pay Brainworks when it was the government department which had been advised by Manyere’s firm.

The mining firms refused to pay Brainworks’ invoices, referring the company back to government.

In the end, the $100 million windfall did not materialise either, Manyere admitted.

“The negotiations were abandoned midway through and as a firm, we decided not to bill our client,” Manyere said.

Only the Blanket Mine indigenisation was concluded and Brainworks is thought to have been paid about $360,000 for that deal.

But Zanu PF MP for Gokwe Nembudziya, Justice Mayor Wadyajena, who chairs the parliamentary committee, was incredulous that the company did not receive payment for work done on the aborted deals.

Kudzanai Chipanga, MP for Makoni West, also asked Manyere: “So could it be correct to say you were doing a community service?”

In response the CEO said: “We have done so many services to government without billing it. We are Zimbabweans and we did all we could in the best interest of the country.”

Still, Wadyajena said the probe was not over, adding his committee would summon NIEEB to explain how Brainworks was engaged.

Not terribly bothered, Manyere said his company was chosen because they “have the knowledge and expertise NIEEB needed.” source-newzimbabwe