NAIROBI, Kenya Apr 20 – Former President Uhuru Kenyatta’s ally John Ngumi had a hard time explaining to MPs how he was paid Sh415 million as a transaction advisor for the Sh6.2 billion Telkom Kenya buyout by the government.
Ngumi who appeared before the Joint Committee of Finance and National Planning and Communication, Innovation and Information Committee of the National Assembly told Members of Parliament that he was paid the lump sum for being the best in the market.
“For Helios to invest it needs to have the highest possible level of advice it can get in order not to make a mistake. You are looking at an investing anywhere around 10M dollars or 500M dollars you can’t afford to make a mistake,” he stated. “Therefore you go out to get the best in the business.”
Lawmakers had questioned how Ngumi was awarded the payment amounting to 10 million dollars for issuing being a transaction advisor for a period of five months
“What kind of skills did you possibly bring on board in these transactions that had an investment banker, lawyers that would make you be paid Sh 350M?” the Chair of Finance Committee Kimani Kuria posed.
Kitui Rural MP David Mbooni raised queries on why Jamhuri Limited contracted Ngumi solely on the transaction advisory instead of contracting the services of his company Eagle Africa Capital Partners.
“You are the owner of Eagle Africa Capital Partners but this contract you have with Jamhuri holding is a contract between you as a person and Jamhuri? Why is that? Why did they contract Eagle Partners and not you?” said Mbooni.
A section of the lawmakers alluded to the fact that former President Uhuru Kenyatta’s ally had advised Jamhuri Limited to sell Telkom Kenya in order to reap the hefty payment.
Ngumi however told legislators that having worked with the mother company Helios Invest in previous transactions they were confident he would efficiently advise Jamhuri Limited to exit the Kenyan market.
“Helios and Jamhuri approached me, I didn’t approach them. They approached in 2021 because I was the existing advisor with Helios with a mandate to work on specific transactions,” he said.
“They approached me with an angry narrative, its was an angry company. This company felt it had come to Kenya on basis of certain undertakings but it was not the case.”
The owner of Eagle Africa Capital Partners outlined how Jamhuri Limited was frustrated with their investment in the country forcing them to exit.
“This is nonsense, what are we doing here. We made at Equity and Flamingo, why are we wasting time here and being treated as if we are not a 60 percent shareholder as if this company is not our company,” Ngumi narrated.
The acquisition of Telkom Kenya by the government has been coupled with controversy after the Treasury withdrew Sh6.09 billion on August 5, 2022, and paid Jamhuri Holdings Ltd, a Mauritius-based subsidiary of Helios basing the transaction on Article 223 of the Constitution.
Revelations by Nyakangó before the committee however indicated the National Treasury bypassed her in the transaction.
The Controller of Budget must approve the withdrawal of cash from the government’s main accounts and has powers to block access to funds suspected to breach the law.
In March, Nyakang’o said that she didn’t give a nod for the withdrawal of the billions to buy out Telkom Kenya from Helios Invest.
“I rejected some of the withdrawals including the Sh6,091,140,702 that was funding to cater for the exit of Helios Investment in Telkom Kenya Ltd. And this was in writing,” said Nyakang’o.
Article 223 of the Constitution gives the Treasury the latitude to spend on emergencies without the approval of Parliament by withdrawing funds from the Consolidated Fund.
However, the law demands that the Treasury must report the same for regularization by the House.
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