Business

By Alari Alare

The four groups seeking to offer legal services in the planned Safaricom initial public offer have agreed to ignore the premature opening of one of the bid packages.

According to the Public Procurement and Disposal Act, such an opening of bids is an offence punishable by law. The Muriu Mungai, Mohammed, Muigai & Company, Kaplan & Stratton and Hamilton, Harrison & Mathews consortia yesterday said they believed that the incident will not compromise the process.

"After careful consideration, we wish to state that we have no reason to believe that the bidding process has been compromised by the accidental opening of one of the financial bids," a brief statement signed by the four firms said.

A bid package prepared by the Mohammed, Muigai & Company Consortium was reportedly opened accidentally by Treasury last Wednesday. Other members of the consortium are Rachier & Amollo, Anjarwalla & Khanna Advocates and Lovells LLP.

The incident could force one of the parties in the process to go to seek legal redress, something that could push the IPO to a later date than the scheduled October listing.

Without confirming or denying the incident, a source at the Treasury stated that if a bid document is opened by mistake, it is usually sealed again and all bidders called for a meeting to inform them of the mistake. "If such a thing happens, then you’ll call all the bidders and let them know of the mistake," he said. "That’s the procedure."

This confirms the last week’s meeting called by the Treasury which was reportedly chaired by Investment Secretary Ms Esther Koimett and attended by Mr Richard Omwela of Hamilton, Harrison & Mathews, Prof Githu Muigai of the Mohammed & Muigai consortia, Mr John Syekei for the Muriu Mungai Consortium and Mr Oliver Fowler for Kaplan & Stratton.

The incident now brings into sharp focus the integrity, security and transparency of the bidding process for the largest IPO in East Africa and the tendering process of IPOs generally in Kenya. In a bidding process, such a breach should force the transaction managers to cancel the process altogether and call for fresh bids.