Koko signed off on questionable Impulse deal himself
'It basically means he’s choosing a supplier that would soon be owned by his stepdaughter to work in his own division'
Matshela Koko personally signed off on a deviation order that allowed his stepdaughter’s company Impulse International to score a R66m deal from Eskom without going out to tender.
Business Day has obtained a copy of a confidential “sole source justification” memo signed by Koko on October 26 2015 to award Impulse a contract worth R65.8m “excluding VAT, accommodation, business travel and per diem”.
Five months later, on March 31 2016, Koko’s stepdaughter Koketso Choma, who was living with him at the time, became a director and shareholder of Impulse.
Choma initially received a 25% stake hidden in a trust, which was later increased to 35%.
Afterwards Eskom awarded Impulse nine contracts worth R380m and subcontracts worth another R260m.
This brings Impulse’s total earnings from Eskom since Koko’s 26-year-old stepdaughter joined the company to R640m.
The deviation Koko signed is listed as an exhibit in an investigation report by law firm Cliffe Dekker Hofmeyr and audit firm Nkonki likely to be submitted as evidence in Koko’s disciplinary hearing.
The report seen by Business Day said it needed to be established whether Choma had paid for the additional 10% stake she was allocated in Impulse.
The report also pointed out that Impulse had made an “inter-company loan” of R16m to an entity Choma’s trust had an interest in that bought a property linked to Koko’s wife in Middelburg, Mphumalanga.
The investigators were not provided with supporting documents for the “loan”.
The deviation Koko signed was for a contract awarded by the turbine generation section of Eskom’s Rotek Industries division.
The memo says Impulse will “support Rotek and Eskom” to provide maintenance services to Eskom’s turbine fleet, which falls under Koko’s power generation division.
“It basically means he’s choosing a supplier that would soon be owned by his step daughter to work in his own division,” said a source familiar with the contract.
Koko faces six charges, including failing to declare Choma’s shareholding in Impulse and his wife’s business dealings with Impulse CEO Pregasan Pather.
Asked on Thursday whether he considered it a conflict of interest to sign a deviation order that his stepdaughter could later benefit from, Koko initially questioned its authenticity.
When it was pointed out the memo is listed as an exhibit in the Cliffe Dekker Hofmeyr and Nkonki report, he said he welcomed the fact that the authors would testify at the hearing.
Asked if he denied signing the deviation, he declined to respond.
“I will only respond to evidence under oath at the hearing. I can’t testify to you — you are not the presiding offer.
The hearing continues on Thursday afternoon.
Read the memo signed by Koko on October 26 2015 about the Impulse contract: