NJM Heat Treatment NDE Services, an engineering firm, faces significant challenges due to allegations of fraud in tender submissions to Eskom and Sasol.
The allegationsAccording to the Directorate for Priority Crime Investigation of the South African Police Service, known as the Hawks, an investigation has found violations of the Broad-Based Black Economic Empowerment B-BBEE Act in tender applications submitted to Eskom and Sasol. The alleged loss to both entities potentially exceeds R400 million.
In August 2017, Eskom issued a tender for non-destructive testing services required during planned outages and maintenance at 15 coal-fired power stations. According to Eskom, NJM submitted an affidavit stating that it was a QSE Level 2 with 51 black women ownership but was disqualified as it could not prove black ownership. The company reapplied for a similar tender in 2020 but was disqualified again during the evaluation process, Eskom said in a statement.
NJMs responseThe directors claim the former shareholder signed the agreement but later clarified via email that the signature was solely for the purpose of supporting the tender application. NJM asserts that the shareholders agreement was not a requirement for the tender and was never submitted as part of the documentation. As it stands, we do not have a binding shareholders agreement, the directors said.
About the Sasol tender submission, NJM says it provided heat treatment maintenance, shutdown services and refractory dry-outs for many years. However, in December 2023, Sasol terminated its dealings with the company following a second investigation into B-BBEE fronting allegations, the directors said.
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