Minor’s N$1.3bn medicine tender halted

The finance ministry has asked the attorney-general whether it is legal for the Central Procurement Board of Namibia (CPBN) to award a N$1.3 billion tender to a company majority-owned by a minor.

The five-year-old child, who is a 51% shareholder in Cospharm Investments, and his Zimbabwean father (49% shareholder) are on the verge of landing a lucrative two-year pharmaceutical supply contract.

The planned award was, however, challenged by other bidders who instituted a review.

The review panel dealing with the matter consists of Tulimeyo Kaapanda (chairperson), Browny Mutrifa, Hellen Amupolo and Gilbert Habimana.

According to publicly available information, Cospharm was initially disqualified from the bidding process after errors were detected on its bidding document, but it made its way back into contention following a controversial reconsideration.

Namibian Sun understands the ministry reached out to the Office of the Attorney-General for a legal opinion on the matter. This was confirmed by deputy finance minister Maureen Hinda-Mbuende yesterday.

Moral and ethical questions

“We came across the matter through the media, because due to the internal processes, we were not privy to the matter. But I can confirm that our ministry has engaged the attorney-general on the legitimacy of ownership of the minor,” she said.

Hinda-Mbuende added: “This arrangement raises moral and ethical questions”.

Cospharm won a bid to supply and deliver pharmaceutical products for the health ministry, which attracted 26 submissions, with 12 companies eliminated from the onset after failing to comply with certain administrative requirements and failing to submit mandatory documents.

The company was one of the bidders not selected for the award initially, as per a CPBN notice dated 26 April.

Cospharm was initially disqualified from the selection process after it was found that it made an overwriting of the bid price on the bid submission form without initialling next to the overwriting.

The company is owned by Zimbabwean businessman Cosmas Mukaratirwa (49%) and his child, a Namibian citizen, who holds 51% of the shares, according to company records.

The child's name cannot be disclosed due to his age.

Cospharm subsequently asked the board to reconsider its disqualification, a move that led to it being awarded the N$1.3 billion supply contract that is now being challenged by other bidders.

Mukaratirwa was thrust into the public limelight about three years ago when he was arrested for allegedly selling unregistered medicine worth N$657 800 to the health ministry.

He was released on a warning.

Board aware

CPBN chairperson Amon Ngavetene said the board is fully aware that the majority shareholder of the company is a minor, something on which the board deliberated before deciding to sanction the award.

"Yes, 51% needs to be a Namibian, but in this case the five-year old does not have any power to enter into a contract. We deliberated on it, and what would then happen is that the minority shareholder, who is the father, has guardianship and is then issued with power of attorney.

“I don’t know whether [the child] stays here or in South Africa, but be that as it may, it was an open international bid."

It is understood that the majority of panel members want the process to start afresh, a move that could spark outrage among successful bidders who feel the process is being tampered with to accommodate Cospharm.