Lefatshe to land smart ID card deal?

Johannesburg, 10 Sept 2008

Tender bid evaluation documents, related to the Department of Home Affairs' (DHA's) smart ID card project, show the State IT Agency's (SITA's) Recommendation Committee (RC) is being asked to propose a joint venture (JV), including Lefatshe Technologies, as the winner of what could be a R16 billion, 12-year deal.

The documents, anonymously provided to ITWeb, include a letter dated today from SITA sourcing specialist Sandile Makhathini to the chairman of the RC. The letter requests the National Pride JV be recommended to DHA director-general Mavuso Msimang as the winning bidder for phases one and three of the project. Oberthur SA is being proposed as the winner of phase two.

Msimang is understood to have the final say.

The document - the authenticity of which cannot be verified - estimates the cost of phase one at R1.2 billion, that of phase two at R100 million and phase three at R15.57 billion.

The National Pride consortium also includes German smart card machinery maker Muehlbauer and Mohlaleng Investment Holdings. Lefatshe and the German concern each hold 45% of the shares and Mohlaleng the remaining 10%.

Lefatshe CEO Noedine Isaacs-Mpulo has confirmed her company's participation in the JV. Lefatshe subcontractors for the bid include Choice Technologies, Satyam Computer Services, Dinala IT Solutions and African Dune.

Oberthur SA is the local subsidiary of a French company and is leading a JV that includes GijimaAst and Guma Smart Card Technologies. The latter have subcontracted Mustek and Bell ID, as well as local black-owned SMEs Pytron and Tirani & Mudau Technologies.

Questions

ITWeb's anonymous source questions the selection of National Pride, saying it submitted the highest bid, "against the cheapest price of about R1 billion".

The source, whose motives are not known, adds that the JV has not implemented a smart card system "anywhere in the world" and its German anchor company's expertise lies in producing smart card manufacturing machinery, which it then sells to smart card manufacturing companies.

The anonymous complainant also notes the presence of many former SITA personnel at Lefatshe, including Isaacs-Mpulo, SITA's business operations chief up till November last year. However, the complainant did not mention that Msimang was SITA's CEO until last May.

The source also questioned the evaluation process and evaluation team.

Response

Isaacs-Mpulo says since submitting its bid, it has "had no communication from SITA relating to the progress of the bid and so are not aware of where the process is right now, nor the performance of our bid in that process. Therefore, I cannot comment on the bid."

She did not comment on the source's allegations.

The DHA could not immediately comment and SITA spokesperson Anthea Summers says the evaluation of the bids is still under way.

"No recommendation can be/has been made... as this is still in the procurement pipeline and needs to go through the process. [...] this process needs to be concluded before any recommendation can be made... and if there are concerns at the end of the process, then it will be dealt with, but we are unable to pre-empt the outcome," Summers says.