Court awards WiA1.5bn/- in damages

The High Court in Dar es Salaam has ordered five South African companies to pay a leading Tanzanian ICT firm, WiA, a minimum of 985,000 US dollars (about 1.5bn/-) for leading a disguised effort to defraud the company and its shareholders.

Commercial Division of the High Court sided with WiA Group Limited that Convergence Partners and its affiliates, including Dimension Data, Convergence Wireless Networks, Dimension Data and Communication Solutions, among others, led a fraudulent and clandestine predation scheme of unlawful taking over WIA from the control of its lawful owners.

The court said it was satisfied that the companies fraudulently coerced WiA to enter into agreement for provision of designated services and supply of products based on uneconomical and unconscionable terms with a motive to defraud it.

Last year, WiA filed a suit against Convergence Partners and its affiliates over the matter. Sued along the five companies, were two foreign directors of WiA - South Africans Andile Ngcaba and Brandon Doyle for negligence and failure to act honestly and in the best interest of the company.

The duo were key architects of the fraud. WiA had accused the South African companies and their affiliates of leading a joint predatory scheme to try to take over the company by forcing it to enter into fraudulent and uneconomic contracts, causing serious financial and economic losses.

The company claimed that Convergence Wireless Networks (Pty) Ltd of South Africa deceitfully induced shareholders of WiA Group to agree to sign the South African firm’s conditional offer and subsequent Sale of Shares and Subscription Agreement (SSSA) and shareholders’ agreement.

Even after acquiring the shares, WIA alleged, the South African company failed to fulfill the terms of the promises, propositions and representations contained in the share sale agreements.

In a ruling read last week in Dar es Salaam, the court declared that the conditional offer culminating with the SSSA and SA were null and void for not having full consent of parties.

The court subsequently ordered that all the shares which fraudulently went into the hands of Convergence Wireless Networks (Mauritius) Limited immediately be transferred to original owners.

The court also ordered immediate removal from their positions of Mr Ngcaba and Doyle. In another development, the court ordered that the second defendant, Convergence Wireless Network (Mauritius) Limited, be removed from the register of members of WiA Company Limited and that the registrar of companies be notified of the decision.

The court further declared that an account and independent technical and financial valuation of WiA be taken to ascertain the level of losses and damages caused by the defendants’ actions and omission jointly and each of the individual.

The defendants have also been ordered to compensate the plaintiff for losses and damaged suffered as a result of collaborating action that led to technical and financial suffocation of WiA.

High Court Judge Kassim Nyangarika also issued a perpetual injunction against Dimensions Data Solutions Limited and other affiliates, including Dimensions Data and Internet Solutions, prohibiting them from conducting businesses or trade which directly or indirectly competes with the business of WiA within Tanzania.
Source: Daily News, reported from Dar es Salaam, Tanzania
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