18 December 2012

Namibia: ACC Monitors Transnamib Property Deals

THE director of the Anti-Corruption Commission, Paulus Noa, says the anti-graft watchdog is studying media reports to decide whether to investigate a deal between TransNamib and Afrikuumba Construction (Pty) Ltd, and other property deals the parastatal is involved in.

Titus Nakuumba, executive director of Afrikuumba Construction, and TransNamib board chairperson Festus Lameck are reported to be close friends. Both have claimed that they are merely acquaintances.

In terms of the deal, TransNamib will lease 69 000 square metres situated along Windhoek's Independence Avenue to Afrikuumba for development. The envisaged development would include residences and a shopping mall.

Lameck last week admitted that he was part of the board decision to give the deal to Afrikuumba.

Upon enquiry, Noa told The Namibian: "We will look into it based on what is reported in the papers. We'll analyse the content of the articles and decide whether there is merit to investigate."

On Thursday, the minister of works and transport, Erkki Nghimtina, was cagey about whether he had given permission for the controversial 50- to 90-year leases of TransNamib property.

The leases, described as a private-public partnership, were reportedly considered as so bad for TransNamib that the permanent secretary of the Ministry of Works, Peter Mwatile, recommended that the minister fire the board, according to a report in the November edition of Insight magazine.

On Thursday, Nghimtina could not say whether his ministry, which is the custodian of TransNamib on behalf of the government, had been informed of the deal or had given approval.

Nghimtina said: "That is a complicated question. I'm studying the whole thing. I'm not saying yes or no. I cannot say something now."

He said he would only be able to speak about the matter "next year".

TransNamib chief executive officer Eugenia Tjaronda on Wednesday said that the line ministry had been informed about the lease transfer.

Nakuumba said on Thursday: "There is nothing wrong with being acquainted with Festus Lameck or anybody else. Even though I know the gentleman, it doesn't mean that's how I got the business."

He denied that there were any underhand dealings. "We don't entertain any corrupt practices. To us, it's above board. We are a company of ethics."

In a statement issued by the TransNamib board of directors on Friday, they accused reporters who wrote about the deal of attempting to paint a picture of dubious dealings between TransNamib and Afrikuumba Construction.

"For the record, there is nothing sinister about the transaction relating to the mixed development of commercial and residential properties of Erf 194 along Independence Avenue, Windhoek."

It said Afrikuumba emerged as the best contender for the project after it was evaluated by management together with outside consultants.

After this, the proposal was tabled to the property committee, who recommended it to the board for approval, the statement read.

Lameck serves neither on TransNamib's management nor on the property committee, it stated.

According to the board, "final approval, and rightly so in line with corporate governance guidelines, was granted by the full board. Therefore, the notion that an 'unconfirmed relationship' between TransNamib chairperson and Mr Titus Nakuumba swayed the transaction in Afrikuumba's favour is baseless, let alone an insult to the intelligence and integrity of TransNamib's board of directors and management."

Under the current dispensation, TransNamib earns a monthly rental of N$240 000 from the property but its expenses amount to N$600 000. This means it is making a loss of N$360 000, the board said.

In terms of the new agreement, TransNamib's earnings will shoot up to N$9 million in year four and N$18,7 million in year five, the board said.

It is understood that Afrikuumba will cover all the expenses during the lease.

Tjaronda yesterday also denied a recent report in Insight that TransNamib wanted to dispose of its 50% stake in the Swakopmund Hotel and Entertainment Centre - reportedly worth N$160 million - for N$2 million.

"It is not true. Legacy Hotels offered to buy the 50% shareholding at N$1 million, but the offer was not accepted by the board of directors," she said.

She also denied that another of TransNamib's assets, the Gammams Training Centre in Windhoek, was making huge losses, as was reported by Insight.

The magazine reported that a recent internal audit report had indicated that the Gammams Training Centre's losses over the past two years were running into millions.

According to Insight, the centre's financial record keeping is said to be a mess as there are allegedly no proper records of guests staying at the centre, while catering equipment, bedding, television sets, projectors and a host of other items have gone missing.

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