Office cleaner named as partner in BEE tender

2012-04-07 14:05

A Limpopo office “cleaner” was named as a Black Economic Empowerment (BEE) front to score a lucrative tender for the construction of a new school in Mthatha, Eastern Cape.

Virginia Magaladi, the 30-year-old woman, has no clue about the details of the multimillion contract in which she is supposed to be a majority stakeholder.

Company records obtained by City Press reveal that Magaladi is an 80% shareholder in Marnolda, a Thabazimbi-based company run by Marius Joubert.

The company was registered by Joubert in 1996 and lists Magaladi as a director since July 2011.

Despite Magaladi being unable either to utter a single word in English or read the language, Joubert claims he entered into a contract (which was drafted in English) with her some time in 2011 to be a business partner in the company.

In December the company was awarded the R15.09 million tender by the Development Bank of Southern Africa (DBSA) which is the implementing agent of the Department of Basic Education’s R6-billion accelerated school infrastructure delivery initiative.

But at a meeting with City Press at Joubert’s lawyer’s offices in Lephalale, Limpopo province, a visibly shaken Magaladi had no clue about the tender or her 80% stake.

“We work together in his business. I sort out papers in the office and I help with whatever work I am asked to do in the company.
“He (Joubert) is teaching me some work with construction,” said Magaladi.

But when specifically asked about the tender for the construction of the school, Magaladi could not give any answers.

Instead, her husband Hans Moatshe intervened and said they were learning construction work from Joubert.

Magaladi said she only met Joubert last year and was asked to sign some documents, but Joubert insisted they had known each other for about 10 years.
In the heated meeting Joubert and his lawyer produced an unsigned Close Corporation Association Agreement written in English with Magaladi’s name at the top and documents from Small Enterprise Employees of South Africa (SEESA).

“I have been looking for a BEE partner for a long time. I needed somebody that I can trust and you know it is difficult for a white person to get work with government.

“I have been working with Virginia for a long time and I trusted her so I did everything according to the law to make her a partner.
“She has been working in my office doing administrative work and I went to SEESA, which advised me on what to do to get my BEE right,” said Joubert.

According to SEESA’s website, they guide businesses in Broad Based Black Economic Empowerment (BBBEE) compliance, verifications and requirements in order to benefit from BBBEE legislation.

The SEESA document, which was issued to Joubert in June 2011 and was addressed to “whom it may concern”, stated that they were assisting Marnolda in drafting its BBBEE strategy to comply with the act.

Joubert argued that he was empowering and uplifting Magaladi and that in a few years she would be able to run the business.
Joubert later backtracked on his earlier claim that Magaladi had a Grade 12 certificate after she revealed that she left school in Grade 7.

According to the Construction Industry Development Board (CIDB), Marnolda qualified for potentially emerging status in terms of the CIDB regulations because it was 80% owned by Magaladi.

“Our regulations allow for a company to be categorised ‘Potentially Emerging’ if it is at least 50% owned by previously disadvantaged person(s),” said Kotli Molise, CIDB communications manager.

Basic Education spokesperson Panyaza Lesufi confirmed that the company was awarded the contract to build the new Kwenxura Primary School in Mthatha.

Marnolda previously did work for government by subcontracting for Limpopo-based Masedi Developers, but relationships seemed to have soured between the two parties.

Thabo Masombuka, an independent commentator and BEE expert, said some of the first signs of fronting were evident when there was an unequal business relationship between white and black participants.

“This woman is of average standing and doesn’t understand the context and extent of being a shareholder.

“It wouldn’t be in this woman’s interest to be an 80% shareholder until she has grown her business profile,” he said.

Speaking after a presidential BBBEE advisory meeting this week, Trade and Industry Minister Rob Davies said a BEE commissioner would be assigned to investigate incidents of fronting. 

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