Mungo Soggot
THE foreign merchant banks handed the contract to help sell a R6-billion chunk of Telkom have secured government agreement that their fees, to be paid by the taxpayer, remain under wraps.
The Posts, Telecommunications and Broadcasting Ministry this week refused to disclose how much money was paid to SBC Warburg, which was employed by the ministry, or Goldman Sachs, recruited by Telkom for the sale.
The Mail & Guardian understands that such banks usually command at least 1% of the value of the deal as their cut – meaning the two could have bagged R60-million.
The 30% stake in Telkom is to be sold to a consortium of Malaysia Telekom and United States group SBC Communications. The deal, unveiled last week, essentially went through by default after leading European bidders France Telecom and Deutsche Telekom decided not to bid.
Connie Molusi, spokesman for Posts, Telecommunications and Broadcasting Minister Jay Naidoo, said the banks had insisted on confidentiality clauses in their contracts. The tab, however, will be picked up by the taxpayer, through the ministry’s budget, and indirectly through Telkom.
Democratic Party finance representative Ken Andrew said there was no reason to keep the fees secret: “It is astonishing that a government committed to transparency under a Constitution such as ours thinks every second matter is an exception to the rule.”
He said the DP was frequently met with “confidentiality clauses” when asking for information such as the salaries of parastatal employees. “Why did they [Telkom and the government] sign the confidentiality clauses in the first place?”
The final Constitution says: “Everyone has the right of access to any information held by the state, and any information held by another person and that is required for the exercise or protection of any rights … national legislation must be enacted to give effect to this right.”
Warburg, which is also advising South African Airways, is top of the international equity privatisation league tables.
The bank raised $6,8-billion for its client in privatisation-related deals between the beginning of 1995 and last September.