Allies of the retired president Uhuru Kenyatta could be dragged from their cosy retirement from the public service and parachuted to the limelight over the controversial Sh6.1billion Telkom Kenya buyout in a hurriedly executed process in the run-up to last year’s General Election.
The National Assembly’s Departmental Committee on Finance and National Planning and Committee on Communication, Information and Innovation has summoned former Chief of Staff and Head of Public Service Joseph Kinyua, former ICT Cabinet Secretary Jose Mucheru and his former National Treasury counterpart Ukur Yatani to appear next week on Wednesday to shed light on the matter.
So far, Controller of Budget Margaret Nyakang’o, Telkom Kenya chief executive Mugo Kibati, immediate former Solicitor-General Kennedy Ogeto and Business Registration Service director-general Kenneth Gathuma have already appeared before the joint committee to shed more light on the Telkom sale deal.
“On Wednesday at 2.30 pm we have sent an invitation to Ambassador Ukur Yatani the former Cabinet Secretary for the National Treasury who authorised all these transactions. The same day at 4.30 pm, we have invited Julius Muia the former Treasury PS.” Kuria Kimani, chairman of the Finance Committee and doubles as the Molo legislator said.
So far, Members of Parliament (MPs) failed to approve the expenditure that was drawn under Article 223 of the constitution.
The probe seeks to establish the circumstances that led to the hurried nature of the government’s acquisition of the telco and to probe whether taxpayers got value for money and if the right procedure was followed.
The sale agreement between Jamhuri Holdings Limited (JHL) – which is fully owned by Helios – and the National Treasury that was submitted to Parliament on Tuesday shows disputes arising from the deal will be referred to the London Court of International Arbitration (LCIA).
It is common for contracts between investors and state-owned entities especially in Africa to provide for disputes to be referred to international arbitrators such as LCIA, the International Centre for Settlement of Investment Disputes and the International Chamber of Commerce that are seen as less prone to political interference compared to arbitration in host States.
This comes even as it has emerged that Kenya could be dragged to a London court should its Sh6.09 billion purchase deal of Telkom Kenya from private equity fund Helios Investment Partners be terminated.
In terms of ownership, Helios Investment Partners is owned by affiliate companies among them HIP GP I Ltd located on Cayman Island with 50 shares and HIP GP Ltd located in the same office on Cayman island which is notorious of offshore stoke market dealings.
Immediate former Solicitor General Ogeto revealed that Paul Gerard Cunningham born in England and Henry Awele Obi, an Irish national leaving in London are the directors of Helios Ltd.
On the other hand, one Robert Mwangi Ndungu, a Kenyan national has been listed in documents presented before the joint committee of parliament as the company secretary.
When she appeared before the inquiry team on this week, Nyakang’o told the joint committee that the government had a deadline of July 29 to beat to pay the money for it to fully acquire Telkom after which the deal would have become null and void.
The budget controller was put to task over her approval for the National Treasury to withdraw money from public coffers to complete the transaction without the approval of Parliament.
Nyakang’o was also at pains to explain the urgency of the Telkom sale to occasion spending through Article 223 considering that the transaction was between a willing seller and a willing buyer.
“As the Controller of Budget, you had the constitutional power to refuse to authorize the withdrawal of the funds. What was urgent in this sale that required spending under Article 223 of the Constitution?” posed Kimani.
“Any dispute arising out of or in connection with this agreement, including any question regarding its existence, validity or termination shall be referred to and finally resolved by arbitration under the London Court of International Arbitration Rule (the Rule), which rules are deemed to be incorporated by reference into this clause,” says the agreement.
“The seat or legal place of arbitration shall be in London in the United Kingdom. The venue of the arbitration shall be in London in the UK,” it says.