Angola fingered in Ericsson's SA lawsuit

Swedish telecom equipment manufacturer Ericsson is facing a multimillion-rand lawsuit in SA over its business dealings in Angola. A Business Day report says Moroccan national Mehdi Bencherki has accused the company of doing an off-the-books deal with him to recoup $200m of its money, held by the Banco Nacional de Angola (BNA), and win clients in that country on behalf of Ericsson. The $19.6m (about R365m) lawsuit launched by Bencherki will be heard in SA courts as Ericsson’s headquarters on the continent are in the country. Bencherki, who now resides in Dubai, alleges that Ericsson contracted him to help facilitate the release of its funds held by BNA as the central bank was experiencing ‘a shortage of foreign currency’ around 2014. Bencherki will tell the court that Ericsson promised him 5% of any funds that he could secure the release of, and that he was due to be paid a fee of $10m on the $200m he said he helped facilitate its release by the Angolan central bank. He said that beyond this, he also, as per the alleged agreement with Ericsson, helped the company win new business in Angola in the form of a contract with Movicel, which saw Ericsson replace Movicel’s then supplier, a Chinese company called ZTE.

The value of this contract was $95m, which meant he was entitled to receive $4.75m in success fees, said Bencherki. He alleged that he entered into an oral ‘business development agreement’ with the company to provide the above-mentioned services, and that the payments that were due to him were not supposed to go to the plaintiff directly, but instead through two intermediaries – one based in Lebanon and the other through a company registered in Mexico. The Business Day report notes Bencherki explained why the agreement was oral and not reduced to writing, because Ericsson wanted to ‘avoid scrutiny from international regulators’. Last week, Gauteng High Court (Johannesburg) Judge Norman Manoim gave Bencherki permission to see his particulars of claim ahead of the matter being ventilated in court.

Full Business Day report