KDPM

Monday, October 15, 2007

Palaver!




It is no secret that for a collective total of nearly 30 consecutive years, Moi and Kibaki have placed Kenyan public assets on Sale, literally at throw-away prices, to their kin, personal companies, and friends (locally and abroad).

Sometimes, the fortitude and patriotism shown by forthright Kenyans have succeeded in stalling their bid to throw away our public assets for a song, and in other instances , we have failed to stop their discounted give-away of national jewels - through their use of state machinery including a corrupted parliament.

History repeats itself in quite interesting ways.

We can remember how the Kenyan public lost its 49% stake at Firestone EA (held under the state corporation ICDC) to one scrupulous "enterpreneur" called Naushad Merali and his so called Sameer Investments company in 1995.

In 1995 Moi ordered the now defunct PRC (Parastatals Reform Committee) to recommend that ICDC offloads its49% Firestone shares at the NSE. That was just a gimmick because according to the Auditor General, Corporations 1996 report,.... Naushad Merali and his Sameer group got pre-emptive rights and bought all those shares for sh 100 million. (for source see below)

Their true value according to the Auditor general was Sh 500 million ( gross undervaluing). BUT WAIT A MINUTE. Three years down the line in 1999, the same shares were re-floated and sold at the NSE for sh 1.5 Billion. Merali made a 1500% profit in 3 years. Merali's genius here is the genius of grabbing and looting since he could have still made profit by buying the shares at their regular value.

Merali's Sameer then used the money to buy East African Cables from a British Holding company in 2000 for sh 110 million when Moi refused KPLC & KenGen from buying the British company's electric cables (economic sabotage). EA Cables true value at the time was sh 274 million.

FAST FORWARD to 2003. The first acquisition by Kibaki and his cronies at Trans-Century was the purchase of East African Cables from Merali. Kibaki had by then simultaneously appointed Trans-Century's god father Eddy Njoroge as KenGen's Managing Director (overt & unveiled conflict of interest). The rest is history,.......you know how EA Cables & KenGen are performing at the NSE.

Track down the business interests of Trans-century and you will see the Sharks, Homeguards and Sultans partitioning and selling Kenya under the guise of privatization.

In the twilight months of Moi's Presidency, just before Kibaki came to power, Moi had a rush to dispose off ( sell for ten pieces of silver) Kenyan public assets in a frenzy that astounded many. In the twinkle of an eye, Kenya-Re and Telkom shares were being offered for sale at exorbitantly discounted rates.

The disposal of these Kenyan public assets was riddled with overt corruption mainly through gross undervaluing of the entities. Coincidentally, at the epicenter of the privatization exercise in the late 90s, early 2000s was Nicholas Biwott's daughter, Ms. Esther Koimett, the then Investment Secretary -whom Kibaki found prudent to serve as Kenya's new Investment Secretary thanks to his renewed political dalliance with Nicholas Biwott.

In 2000/1 Esther Koimet almost facilitated the sale of Kenya-Re ( a public asset) to Zim-Re (of Zimbabwe ) in partnership with Monarch Insurance (owned by Gideon Moi) for less than one-third it's value. Gideon Moi and his shielders Zim-Re of Zimbabwe almost bought the entire Kenya-Re for 800 million shillings when it was valued at more than 2.5 billion shillings in 2001.

Who halted the sale? After the Parliamentary Investment Committee (PIC) failed to stop the sale on procedural grounds, three MPs filed a successful court injunction blocking the sale: Prof. Anyang Nyongo, Wafula Wamunyinyi and Musikari Kombo. The ruling was made by Justice Hayanga.http://www.nationaudio.com/News/Dail...usiness65.html


Thanks to the three MPs, we were luckily to have survived the transfer of Kenya Re into the hands of Gideon Moi in exchange of ten pieces of silver.

But we were never always lucky, we lost some battles to the Moi privatization frenzy.

Telkom had off-loaded much of it's shares in Safaricom (the mobile phone giant) to Vodafone, and within the shady transaction, a secretive entity known as Mobitelea ( Moi Biwott Telecommunication East Africa ), controlling 5% stake in Safaricom was born. Kenyans failed to read and pre-empt the illegal transfer of public assets into the hands of political families without their paying of a single dime. The Moi family and their two little partners in Mobitelea raked in Shs 850,000,000 last year alone thanks to that illegal transfer. The money is at their disposal to bribe weak and unprincipled political leaders, to create further confusion in the country, the perfect environment to enable their continued milking of our coffers.

Gideon Moi's Mobitelea is now subject to yet another controversy, since the government wants again, to offload some more Safaricom shares to the public in an at temp t to further hide disclosure facts.

History is repeating itself. This time around, it's a Kibaki privatization frenzy!

This time yet again, some patriotic and forthright Kenyans like Raila Odinga, are demanding full disclosure about ownership of Mobitelea and strict adherence to the provisions of the Privatization Act 2005, before any Safaricom IPO's are floated. Finance Minister Kimunya's own floatation rules are quite suspect, listing only 47% shares available for the public, with 50% shares going to the so-called high net investors, the likes expected to occupy Kibaki's re-election fete - the million-per-plate dinner. Kenyans are being taken for some dumb fools here.

Raila has threatened to file an injunction in court halting the offer citing both procedural issues -failure to abide by the Privatization law and the failure to comply with the full-dislosure requirement of privatization.

On privatization, Kibaki has specifically succeeded in hoodwinking many unsuspecting Kenyans when he releases public reports citing "successful" privatization efforts and IPO floatation. This he did with the recent KenGen and Mumias offers, where his government craftily pretended to offer 97% shares to the public -when in essence they had a huge pre- allocation for high net investors (friends of Kibaki coming in names like TransCentury Investors and Baraka Afrika) who ended up acquiring huge stakes, 30% and 25% shares
respectively,......from the two companies.

This my dear friends is what is called transferring (giving away) public wealth into the hands of a few politically connected individuals. This largely contributes to the astronomically increasing gap between the rich and the poor in Kenya . It grossly undermines our economy in the long-run despite the short-term busy season it offers at the NSE.
I'll quote Macharia Gaitho's Jan 24th, 2006 Sunday
Nation editorial piece
quote from article.........

"one of the Ministers involved in the (Anglo-Leasing) cover-up is quoted as saying that 'President Kibaki is above money' and 'does not touch money'. The problem is, he depends on others to worry about how his political projects will be funded. And he asks no questions about the source of funds. Some of those fellows (he depends on) are now running some key state corporations, and are also linked to the investment groups that seem to have the inside track on a very opaque privatisation of public corporations. " end of quote. (Mr Gaitho is the managing editor, Sunday Nation)

Do the names TransCentury or Baraka ring a bell? The companies that have questionably acquired within four years under Kibaki's presidency : major stakes in all recently privatized parastatals besides, 20% stake in Rift Valley Railways, majority stakes in East African Cables, 2.13 million shares of Kenya Power (KPLC), 10% of Development Bank of Kenya, and a sizeable chunk of the mortgage giant HFCK.

What about Kibaki's friend Moi and Mobitelea? What about Kibaki's friend Biwott who's Kobil company also recently secured a Shs 3 billion oil supply deal to KenGen?

Githongo's own insight, has told us in Kiraitu's words & admission,...that the very Kenyan taxpayer, was to be robbed in excess of Shs 5 Billion,..to fund Kibaki's 2007 elections. According to Githongo, more than 200 billion shillings has been lost under the facilitatory watch of these two Wazees Moi and Kibaki.

And my true vote Goes to Raila. Lets use Internet media to campaign for our Man " Kimibei"

1 comment:

Peter said...

Why is everyone just very eager on taking Kenyans for ride? Safaricom CEO Michael Joseph has joined the fray of influential people who think we are so naïve that we can’t think wide. I had forgotten the “peculiar habit” thing but this is now very unacceptable.

Before he starts claiming of being misquoted by the press Mr. Joseph commented on ownership of Safaricom as a 60:40 venture between the government and Safaricom; and just to ensure the was no one sided reporting I read both the leading local daily newspapers and both reports we very consistent.

“Asked about the ownership of the firm, Mr Joseph maintained that Safaricom had two shareholders — the Government, through Telkom Kenya, with 60 per cent, and Vodafone Kenya Ltd, with 40 per cent
In as far as am concerned, the ownership is split between the Government and Vodafone," he said. "However, the entire ownership structure of this company will be explained once the prospectus is printed and released to the market." Is this the part when he will know reveal Mobitelea.

It astonishes that while Mr. Joseph is busy denying knowledge of Mobitelea and its alleged connection to Safaricom, A news article that appeared on one of Britain’s most respectable newspaper as early as February 2007 on Mobitelea. In the online report, Vodafone refused n a formal request from the Public Investments Committee (PIC) to reveal the owners of Mobitelea but, in a letter to the committee that has been seen by the leading British newspaper; Gavin Darby, Vodafone Group's chief executive for the Americas, Africa, China and India, stated that Mobitelea was Vodafone's chosen partner in Kenya.

So while Mr. Joseph denies any knowledge of Mobitelea, His bosses at Vodafone explained that "When Vodafone makes investments in new territories it is not uncommon that it works alongside a partner who typically gives advice on local business practices and protocol and the various challenges associated with investing in a new market. Vodafone would prefer to be in a position to make a comprehensive disclosure but, having taken legal advice, could be in breach of a duty of confidentiality were it to discuss Mobitelea further."

In his letter, Mr Darby said that Mobitelea was allowed to invest in Safaricom "in return for its valued advice". This is just how lucrative the opportunity was. Other Investigations reveal that in return for its services, Mobitelea was given $5m in cash and a 5% stake in a company that analysts value at $2bn. So Mr. Joseph, why don’t you just tell us that it’s the identity you can’t reveal because of legal implications, that sounds much better? I’m suggesting it’s time Safaricom hired a Public relations person or still thinking of it a firm.

David