In this final episode, we look at the people who are going to answer hard questions from the World Bank, how weak policies by international development financial institutions is abetting tax avoidance and corruption in Africa. And finally look at what the future holds for RVR.
By PATRICK MAYOYO
As the World Bank investigations against RVR intensifies over suspected embezzlement of billions of shillings, attention is going to be focused on seven key people at the rail company.
Those attention is going to focus on include, Mr Brown Ondego, Dr Ahmed Heikal, Mr Karim Sadek, Mr Carlos Andrade, Mr Darlan de David, Mr Titus Naikuni and Mr Isaiah Okoth.
Dr Ahmed Heikal is the founder and chairman of Qalaa Holdings (QH). Qalaa Holdings is the parent company of RVR and Dr Heikal personally spearheaded the firm’s entry in the East African market through investments in the Kenya-Uganda railway.
He will be a person of interest in the ongoing investigations.
In the past 10 years Dr Heikal has transformed Qalaa Holdings from a general partnership private equity manager with EGP 2 million in capital to a leading investment holdings firm investing in Egypt and East Africa with EGP 9.1 billion in capital.
The firm is a leading investor in a number of platform companies in the energy, cement, transportation & logistics, mining, consumer finance and retail sectors. He spearheaded Qalaa Holdings entry in the East African market through investments in the Kenya-Uganda railway.
Mr Brown Ondego, a former Kenya Ports Authority managing director joined RVR in 2008 as executive chairman before being relegated to the position of Executive Vice-Chairman in November 2012 where he became in charge of governmental and regulatory relations.
It was during his tenure that RVR spent more than Sh 2 billion or US$ 20 million to repair 73 kilometers of the railway track between Mombasa and Nairobi.
The railway modernisation project was aimed at reducing cargo delivery time between Mombasa and Nairobi by six hours through rebuilding the most badly rundown sections, which were responsible for 60 percent of blockage time on the rail line due to derailments.
It is a project of interest to World Bank investigators according to those aware of the ongoing investigations.
“The completion of this project under our continuing track upgrade program has considerably improved the reliability and efficiency of our operations. We are now operating larger-capacity trains and, as a result, have improved our loading capacity and reduced travel hours,” Mr Ondego said at the time. See link: http://tinyurl.com/j3who6u
Mr Darlan De David was the RVR Chief Executive Officer when the company entered into a contract with a company called Yalda Ltd trading as Gear Africa based in Mauritius for the supply of a computer system for monitoring trains along the Kenya-Uganda railway at a cost of more than Sh 900 million (US$ 9.3m).
The contract that is also said to be a subject of the ongoing World Bank investigations was for technology upgrade that included global positioning system (GPS)-based software that centrally controls the movement of trains and cargo along the railway track.
The automated train warrant (ATW) software was to allow online visualization from an operations control center in Nairobi of the precise location of trains along the railway. It was to replace manual management of crossovers at railway stations with satellite-enabled self-switching movement of trains.
“The introduction of satellite navigation technology to this core component of our operations means we will eliminate a lot of waiting time at stations by giving priority track access to trains carrying cargo and also allow us to handle larger fleets,” Mr De David said at the time.
See link: http://tinyurl.com/jglmx6f
Mr Karim Sadek, as the managing director of Qalaa Holdings (formerly Citadel Capital) oversaw Africa’s leading equity firm’s acquisition of a 49 percent stake in Sheltam Railways Company, the largest single shareholder and lead investor in RVR.
Sheltam owns 35 percent of Rift Valley Railways (RVR), which has a 25-year concession to operate a century-old rail line with some 2,000 kilometers of track linking the Indian Ocean port of Mombasa in Kenya with the interiors of both Kenya and Uganda, including the capital city of Kampala. The transaction gives Citadel Capital an effective ownership of 17.5% of RVR.
“Citadel Capital will look to inject more than US$ 150 million in Kenya Uganda Railways over the coming five years,” said Citadel Capital Managing Director Karim Sadek. “This is the first of several investments we are exploring in East Africa and is a natural extension of our proven interest in the continent’s transportation and logistics sector.”
See link: http://tinyurl.com/ztvq35j
As the managing director of Qalaa Holdings, Mr Sadek is expected to shade light on most of queries that are going to be raise by World Bank investigator.
Mr Carlos Andrade was at the helm of RVR for four years until March 1, this year when he was replaced by, Mr Isaiah Okoth as the new group CEO.
Mr Andrade is the man who oversaw the Sh 28 billion (US$ 287) million capital expenditure plan that involved a series of loans from different financial institutions.
Andrade was instrumental in the rollout of the railway’s capex programme and the improvement of its operational efficiency and if there is one person who can provide the much needed answers to the World Bank investigators he is the one.
Mr Titus Naikuni was appointed the chairman of RVR in November 2014 at a time when the Sh 28 billion (US$ 287) million capital expenditure plan was being implemented.
He is expected to tell the World Bank investigators the decisions the RVR board of directors took concerning the projects in question.
He joined RVR at the time it was receiving the first delivery of 20 General Electric locomotives acquired from the United States.
The locomotives are said to be part of issues under investigation by the World Bank. See link: http://tinyurl.com/zkngrbg
Mr Naikuni is a former CEO of the national carrier Kenya Airways where he was at the helm from 2003.
Mr Isaiah Okoth who joined RVR in March this year as the new Chief Executive Officer might not be having answers to many questions being raised at RVR, but as the CEO he is expected to facilitate seamless investigative process.
Mr Okoth is the former East African General Manager of GE Healthcare, and took over operations at RVR from Carlos Andrade who has been at the helm of RVR for the past 4 years.
See link: http://tinyurl.com/j3x8u9u
Mr Okoth was highly tipped to bring success at RVR before the emergence of recent activities.