China-based ZTE has asked its lawyers to intervene in the dispute between its SA-based sister company, ZTE Mzanzi, and Telkom, after ZTE Mzanzi successfully asked a court to stop Telkom from rolling out a R13 billion network upgrade.
At the end of last month, the North Gauteng High Court ruled that Telkom had to engage with ZTE Mzanzi, after it lost the tender to upgrade Telkom's network. The tender was awarded to Huawei and Alcatel Lucent, but ZTE Mzanzi argued it was unfairly disqualified from the process.
Yesterday, China-based ZTE, which has a minority stake in ZTE Mzanzi, and ZTE SA issued a statement in which the companies distanced themselves from ZTE Mzanzi's court action. The companies said they did not support the action against Telkom.
“These legal proceedings were instituted without ZTE's approval and without the approval of its representative on the board of ZTE Mzanzi.”
The companies have instructed law firm Bowman Gilfillan to apply to the High Court to set aside the interdict and to stop the alternative dispute resolution mechanism, the entities say in a statement.
ZTE Mzansi director Tumi Magasa says he has not seen the court papers, but would have expected ZTE to celebrate the chance to participate in the Telkom rollout. ZTE Hong Kong, which owns a 40% stake in ZTE Mzanzi, turned over $13.7 billion in the year to December.
service access nodes (MSANs) as part of its network revamp.
ITWeb understands the tender was for a two-phased implementation. The first part - to replace the MSANs - is worth around R5 billion, while the second phase will move the entire network to IP. In total, the deal is worth around R13 billion over about five years.
Telkom has said ZTE Mzanzi's court win is a blow to consumers and that its procurement policy will “stand up to scrutiny”.
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