HARARE – Suspended NetOne chief executive Reward Kangai has appealed to President Robert Mugabe for intervention in his epic duel with Information Communication Technology minister Supa Mandiwanzira, whom he has accused of running a witch-hunt against him and several other out-of-favour executives.
This also comes as Alex Marufu’s board has sought to sustain allegations that the long-serving public sector boss was guilty of a number of “impropriety and malfeasance” charges, including his handling of the $298-million Huawei mobile broadband (MBB) project Firstel Cellular (Firstel) acquisition, and debt issue.
“The decisions to undertake a forensic audit (at) NetOne and for the CE… to be put on forced leave were not board decisions, but directives from the minister after resistance… to make unprocedural payments to a bogus entity… Megawatt Energy (Megawatt),” Kangai said in an April 21 letter to Cabinet secretary Misheck Sibanda.
“On the forensic audit issue, the chairman had attempted to get the board to appoint a hand-picked… BCA Consulting, the same auditors previously used by… Air Zimbabwe,” he said, adding the vaunted investigation was nothing more than “a witch-hunt coming… after my principals (had) hit a brick wall in trying to coerce management to make illegal… payments and I (had) turned down their offer for shares in Blue Sea Technologies through a proxy…”
Fronted by ex-ZTE boss Xiaodong Li, Megawatt is a South Africa-based consultancy which was hired by the minister to audit NetOne’s data project with the Asian giant and under which the company was to be paid $4 million.
Even, though, the local mobile giant’s forensic audit was being done by the reputable PriceWaterhouseCoopers, Kangai makes an impassioned plea for an independent “commission of inquiry to be set up and look into all… issues, as the proposed forensic audit is a… fight-back against those standing in the way of corrupt activities”.
Having been served with a three-month suspension in March, the soft-spoken Kangai not only believes he was being victimised for refusing to aid and abet Mandiwanzira’s dodgy activities such as honouring the Megawatt deal, but for allegedly exposing the minister after one of his relatives had reportedly wracked a company car.
“It will be clear from the chronology of events… that the two (minister and Marufu) have literally ganged together to push their hidden agenda… by supplanting NetOne management with their own select… relatives,” Kangai said in the 55-page rejoinder seen by this paper.
“…the minister indicated his displeasure with NetOne management and alleged… (we) had complained to… Cabinet that he was abusing NetOne facilities through a vehicle that had been availed to him by NetOne last year. He went on to state that the CEO must leave the operations of NetOne to the newly-appointed chief operating officer… Brian Mutandiro, who was only 11 days old in the company,” he said.
And as the Harare administration — and Zimbabwean market at large — tries to digest Kangai’s allegations that the new Reserve Bank regime was out to clear the entire team from his era, it has emerged that more managers continue to be fired with the latest being one Munakiri from finance. This is also in line with a restructuring process superintended by new chief financial officer Sibusisiwe Ndlovu — the progenitor of the NetOne probe and a key nemesis of the old order team.
While Mandiwanzira and company’s trump card against Kangai’s team revolves around the alleged over-inflation of the Huawei contract, and handling of an $11 million debt owed by Firstel — a company, which they indirectly owned via Fonedex — the under-fire executives say there was nothing amiss about the pricing of mobile components on the network expansion deal as the local company did not enjoy the economies of scale possessed by its regional peers such as subsidiary firms of groups like MTN of South Africa.
In the hard-hitting letter, Kangai also decries bureaucracy and policy contradictions that have impaired the company’s progress, and such as Marufu’s criticism of a $600 million China Exim Bank loan facility for network expansion signed in August 2014.
“This is a very serious shortcoming… as he fails to recognise that NetOne… carries certain non-commercial obligations… in order to support government programmes in the sector. The board chairman… has even rebuked China Exim Bank loan… after rigorous considerations on the part of the ministry of Transport and Communications and… yet Marufu claims that it was ill-thought..,” the trained engineer said, adding his foes were “completely devoid of knowledge of the difficult path trodden” by the State-owned Telco.
“This shows a total disregard to all previous efforts made towards building a success path… under very difficult circumstances and… wickedness of wanting to take credit for something he had no part in. (Marufu) has continuously challenged government policies, as… shown on the issue of Firstel,” Kangai said, noting the “major handicap of the board was that it is run by an overly powerful and arrogant board chairman, who bulldozes his way”.
Despite these odds, which included serious under-capitalisation since 1996, the public sector executive says his team had done its best to keep the company afloat and NetOne’s relationship with suppliers such as Huawei dated back to 2005 when no other contractor would deal or touch the cellular company.
After supplying the Zimbabwean company with its second mobile switch in 2007, the Asian giant went on to give 50 base stations for the southern region.
“It is also important to highlight that during the period 1999 to 2010, there were no major foreign currency inflows made into the capitalisation of NetOne. From its inception (in 1998) to date, NetOne has depended on debt financing for its capitalisation,” Kangai said.
“NetOne grew significant market share, which has been disproportionate to its capital investment… $400 million… versus $2 billion by Econet to-date and yet market share is about 30,7 percent or 3,8 million subscribers for NetOne against 53,9 percent… for Econet,” he said, noting further that “a lot more could have been achieved had the board chairman not scuttled some of the key projects proposed by… management”.
The latest disclosures follow another February 19 letter and in which Kangai told ICT permanent secretary Sam Kundishora that Econet had more than 1 500 masts as compared to NetOne’s 550 as at October 2015.
It is not clear whether Mandiwanzira has had sight of the suspended CE’s riposte and whether he has been given an opportunity to respond to the litany of allegations — by his superiors — raised in the dossier. In recent months, the former broadcaster has said he has “no time to respond to flies”.