Battle erupts over Vodacom BEE

By Damaria Senne, ITWeb senior journalist

Johannesburg, 05 Jun 2008

Vodacom says it is prepared to defend itself against a court interdict filed by one of the short-listed bidders that lost out on its R7.5 billion black economic empowerment (BEE) deal.

The Tiger Consortium, made up of black Vodacom employees and black business partners, has filed a court interdict to challenge Vodacom's BEE plans.

The case is to be heard tomorrow in the Johannesburg High Court. "I can confirm that we will be defending this matter," says Vodacom spokesperson Dot Field.

Tiger Consortium spokesman Jacobus van Schalkwyk says the consortium is asking the High Court to rule that Vodacom must include it as part of the BEE deal.

"The Tiger Consortium is not fighting the fact that it lost the bid. It is challenging the fact that Vodacom is allocating BEE shareholding to the consortium's components, even though it rejected the consortium's bid," he says.

"You cannot use my arms and legs and reject my head. At the end of the day, the intellectual capacity comes from the head."

In April, Vodacom announced that 25% of its R7.5 billion BEE shareholding would be allocated to Vodacom SA staff members.

Broad-based black members of the public, and Vodacom black business partners would have access to 30%, with the remaining 45% going to broad-based strategic partners, it said in a media statement.

Vodacom later announced the Royal Bafokeng Holding and Thebe Investments as its strategic partners.

By staff, for staff

Should the court action be successful, Van Schalkwyk says Vodacom's proposed allocation of BEE shareholding to staff and black business partners would not change, as these two categories were already members of the Tiger Consortium.

The only difference is that the groups would gain their proposed shareholding through the consortium body, rather than directly.

Van Schalkwyk says the Tiger Consortium is an initiative of Vodacom SA staff, who presented the initial proposal to buy Vodacom shareholding in 2004.

Consortium members also include the Black Business Partners Forum and other broad-based groups formed, he says.

Consequences

Members of the consortium will lose the body that would safeguard their interests and negotiate on their behalf if the consortium itself is kept out of the deal, says van Schalkwyk.

The consortium also has a unilateral agreement with its members, who could sue it if things went sour, he adds.

Van Schalkwyk also alleges that several Vodacom staff members were suspended due to their participation in the litigation.

Field would not comment on the alleged suspension. The Communication Workers Union said it was aware of the developments, but was unable to comment at the time of publication.