Fixed-line operator Telkom does not owe Square One Pty - a previous subsidiary of listed Square One Solutions - any payments, it says.
Square One Pty was liquidated late last month, after it failed to pay creditors. The company owes about R9 million to 10 creditors. Its lawyer says Square One could not pay its debt, because Telkom had not paid it.
However, Telkom has denied there is any outstanding money. Ajith Bridgraj, senior specialist for media relations, says Square One was paid for contracted work that was performed and completed over the past 24 months.
Bridgraj says, however, because of poor performance by Square One and its suppliers, the company was liable for penalties, which resulted in payments being withheld from December.
The total value of the blocked payment amounted to about R2.6 million, says Bridgraj, and not the R9 million the company's lawyer says is in dispute. “Allegations of non-payment to the value of R9 million are, therefore, erroneous and baseless,” says Bridgraj.
Telkom's contract with Square One expired in October 2009 and was not extended or renewed.
“Although Telkom enjoys a healthy and nurturing relationship with its vendors, the company cannot be held solely responsible for the sustainability of its independent suppliers as it is incumbent on all vendors to manage their own business risks, including the fact that no supplier should be totally dependent on a single client for its survival,” adds Bridgraj.
Listed Square One Solutions bought the Pty for R1.6 million in 2004, and spun it out of the group towards the end of last year.
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