Basil Read says it owes Eskom nothing


Basil Read says it owes Eskom nothing

Published Date: 2020-07-13 | Source: Stephen Gunnion | Author: Stephen Gunnion

Basil Read says it owes Eskom nothing

The construction and engineering group sold out of a joint venture that was working on the Kusile power station in 2017.

Basil Read has distanced itself from any liability relating to an overpayment by Eskom for work on its Kusile power station. The construction and engineering group says it reached a settlement agreement with Stefanutti Stocks in September 2017, in which it sold its interest in their joint venture back to Stefanutti, indemnifying it from any and all liability.

A briefing document by Eskom last week alleged that the SSBR joint venture was paid to much for work done and was among a number of contractors that were overpaid by R4 billion for work on the power station. However, Stefanutti disputed the claims, saying all payments received from Eskom were made after certificates had been issued by the independent engineer on the project and that audits had been carried out. It claimed the joint venture was still owed money for work done since December 2018 and that Eskom had committed to a claims resolution process.

Basil Read said it sold out of SSBR as the contract had been loss making, due primarily to a lack of resolution with regards to the claims for extension of time. It placed itself in business rescue and suspended its shares two years ago after its funders refused to provide it with bridge funding in an informal process. It needed the funding to finalise some of its contracts while it waited for cash to come in from the disposal of non-core assets and completed contracts.

The company's shares were trading at 4c when they were suspended in June 2018. Stefanutti's shares declined 21% last week, closing at 30c on Friday.

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