The Optis Telecommunicaiton consortium on Friday found itself fighting for survival as more damaging allegations emerged while its bid was under examination.
Already rocked by allegations that significant parts of its bid document had been plagiarised from work done by the chairman of Goldleaf, the competing consortium, Optis found itself hard pressed to explain the involvement of telecommunications vendor Siemens in its bid.
Under questioning from councillors of the Independent Communications Authority of SA (ICASA), Optis admitted that Siemens had been involved in the preparation of its bid but had not been involved with the consortium "for the past couple of months".
However, Siemens flatly denies that it officially supported Optis.
"We did not contribute to either the Optis or Goldleaf bids," says Pete da Silva, COO of Siemens Telecommunications.
Siemens has started an internal investigation to determine how its intellectual property was allegedly included in the Optis bid.
If Optis cannot claim full ownership of the bid document its quest to own 51% of the second national operator (SNO), due to start competing with Telkom next year, could be over. The rules for the bidding process do not allow for documents to be amended.
Hard questions
It is not only issues of intellectual property that have plagued Optis.
The ICASA councillors, who sometimes had difficulty in hiding their mirth during the questioning, had obvious concerns about the composition of the Optis group. The consortium is 73%-owned by Warren, Alan and Monique Friedland, with a further 10% owned by Lotsons, a firm controlled by three brothers, one of whom is Seth Phalatse.
The councillors made it clear that they found it strange that 83% of a group hoping to control a multibillion-rand telecommunications operator is owned by six individuals. They were even more incredulous at the Optis argument that more than 60% of the consortium will still be handed to finance partners yet to be identified.
"What we see here is not what we get?" asked ICASA chairman Mandla Langa at one point.
Optis also found it difficult to explain how it concluded that South Africa does not have enough skilled people to run the SNO after it admitted to having done no research on the issues.
Other outstanding issues include the status of the 18-year-old Warren Friedland, who owns 30% of Optis. The consortium believes he has been tacitly emancipated, making his involvement legal despite the fact that he is a minor, but it emerged that his studies in London are funded by his father and that he still draws an allowance.
Yet despite the systematic demolition of most of its bid, Optis tried to maintain a positive stance. "We do apologise for numerous formal errors that were made," legal director Ian Levitt told ICASA, but said it was "without doubt" possible for these to be remedied.
Levitt and public relations representative Gillian Gamsy several times called on ICASA to judge the bid as a whole and focus on the fact that Optis plans to bring a reputable foreign operator, in the form of Shanghai Telecom, to South Africa.
ICASA is to put written questions to both the Goldleaf and Optis groups, with answers due in two weeks. The adjudication process is due to be completed in January next year.
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