- Ithuba Solutions fail to block contract negotiations
- Court throws out Ithuba’s urgent application
An attempt by Ithuba Solutions to stop ongoing negotiations between Gambling Authority of Botswana and Grow mine Africa, which will culminate in the award of a multibillion pula lottery licence failed on Thursday when the High court dismissed their urgent application.
Judge Omphemetse Motumise, ruled that the Ithuba Solutions application is not urgent as they will not suffer any prejudice from the ongoing negotiations, and will still have an opportunity for recourse in the normal process.
Ithuba Solutions, who have been selected as the reserve bidder, sought to interdict Gambling Authority from continuing negotiations with Grow Mine after the latter was selected as the preferred bidder for the award of the lottery licence. Should negotiations continue, lthuba argued that they will suffer apprehension of irreparable harm notwithstanding that they have a right to appeal to the Minister if its appeal to the Board of Directors of the Gambling Authority is refused.
To support the urgent application, Ithuba had raised numerous irregularities relating to the application processes for the National Lottery Licence in Botswana following a Request for Aplications (RFA) including the evaluation, adjudication and announcement of Grow Mine as the preferred applicant.
Among Ithuba’s complaints was concern that PPADBA procedures and Regulations were not followed in the adjudication of bids/ applications. However, Grow Mine countered that such statute promulgated under public procurement are only applicable to Central Government and local authorities, while state owned enterprises (parastatals) have their own procurement procedures, which differ from one entity to the other.
lthuba’ also complained that the Gambling Authority developed an obsession with citizenship participation during the tender adjudication, which was not consistent with the Request for Applications for the National Lottery Licenceissued by the Gambling Authority at the beginning of the National Lottery Licence application process. Among the RFA requirements was that bids must have meaningful economic citizen empowerment, and meaningful participation and/or representation in key decision-making levels of the company by citizen shareholders; meaningful participation and/or representation in the key decision-making of the company, such as management and control by citizens of Botswana, and further a meaningful role and participation at the shareholder level of the company – that is, the substantial actual ownership stake, participation and economic empowerment of citizens in the corporate and shareholding structure of the company; a demonstrable plan involving training, development and transfer of skills to citizens; and that the technology partner of the bidder must have an office in Botswana.
lthuba’s South African majority shareholder owns 87.5% shareholding in Ithuba Solutions, the Botswana registered subsidiary. Glimpsed from CIPA records, Ithuba’s shareholding is made up of Flameback (25%) and Zamani Gaming (75%), with Flameback further owned by Boy Eric Mabuza (50%) – a South African national, Benson Masego Madisa(25%) and Todd Mhenyadira Mangadi(25%). The latter two are Botswana citizens. Effectively, the local shareholding element amounts to an effective 12.5% split between Todd Mangadi and Benson Madisa, which amounts to only 6.25% each of beneficial interest in lthuba.
On the other hand, Grow Mine Africa is owned one hundred percent (100%) by a group of Botswana citizens.
Grow Mine had also pleaded with court to dismiss the urgent application because since the Gambling Authority circulated the RFA for the National Lottery Licence, lthuba in words and deeds represented, and continued to represent that it was happy and satisfied with the processes, and it took no step to challenge anything since 12 October 2017, the date of submission of the RFA until 3 July 2020, when they lodged an appeal to the Minister.