SA's top mobile operator, Vodacom, is not talking about a lawsuit seeking R296 million, filed against its operation in the Democratic Republic of Congo (DRC) by African business consultant Moto Mabanga.
According to recent reports, Mabanga, of Nameco Energy, has filed an affidavit claiming his company was contracted to consult for Vodacom in the DRC between 6 May and 31 July 2007 and between 12 September 2007 and 31 August 2008.
Mabanga earned $2.8 million, according to his affidavit, but he is now claiming $40.8 million as a “success fee”. Reports indicate that Mabanga has attempted to negotiate the matter with Vodacom, but the mobile operator refused to discuss the payment he is claiming.
“Vodacom acknowledges receipt of court papers and will be defending the matter. It is currently sub judice and so we have no further comment at this time,” states Richard Boorman, executive head of corporate communications at Vodacom Group.
The suit comes amid ongoing internal turmoil at the DRC operation, and Vodacom has hinted that it may well be working on an exit strategy if shareholder tension is not resolved by year-end.
Ongoing battle
The mobile operator has been at loggerheads with Congolese Wireless Networks (CWN) regarding a funding agreement in place between the shareholders.
The Congolese company also accused Vodacom of forcing its DRC operation to pay up to $180 million to satisfy loan agreements with “uncommercial terms and conditions”. In January, CWN threatened to take the matter to the courts in Kinshasa.
Vodacom lashed out at the accusations, saying CWN has made it impossible to find an amicable arrangement.
Vodacom maintains it has single-handedly supplied the funding to Vodacom Congo at commercial terms that were agreed upon by CWN's directors. “Any intended litigation on this issue is entirely without merit and a contrived attempt to force Vodacom to disproportionately fund further investment,” the company noted earlier this year.
Speaking at the operator's quarterly financial results last month, Vodacom CEO Pieter Uys noted that the operation is still running. However, the company will have a board meeting soon and would then head into arbitration at the International Trade Commission court, he explained.
He noted that, parallel to this process, Vodacom will look at all possible options and engage with shareholders to discuss a way forward. “By the end of this year, we will know where we are in the Congo.”
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