MERGERS, ACQUISITIONS AND FINANCIAL RESULTS
Gijima Ast Disputes R4bn Contract Cancellation in South Africa
GijimaAst is still locked in discussions to save a R4bn contract that was cancelled by the Department of Home Affairs in April.Financial director Carlos Ferreira said last week discussions to "find a resolution suitable to all parties" were continuing.
He would not provide further information, including whether the company was being paid for continuing with the implementation of the project at the department's offices until the matter was resolved.
In April, GijimaAst lost one of its biggest accounts, which brought in 15% of its total revenue of R1.44bn in the six months to December, when the department cancelled the tender awarded in 2008, citing non-delivery.The company's share price has fallen 25,7% (from R1,09) since the announcement on April 15.It closed unchanged yesterday at 81c. The company's market capitalisation is R794.9m.
GijimaAst was awarded the tender, dubbed "Who Am I Online", to implement technology to track citizens from birth to death, by linking with the automated fingerprint identification system. The system linked immigration, police, health department and revenue service databases. The project was supposed to pave the way for smart-chip technology such as electronic passports and smart identity cards. It was also critical for the registration of visitors for the World Cup. GijimaAst is disputing the department's claim that the contract is invalid.
This month, it won a multimillion-rand IT contract for the Gauteng open-road tolling system.