Nairobi News


Sh600m loot for River Road wheeler-dealer

Gill House, an office block on Moi Avenue in Nairobi, is not commonly the address for blue-chip companies doing multi-million international deals. Well, it is now.

Inside this five-floor building, where rent for a single room is Sh20,000, was a 20-month old company — Aero Dispenser Valves — that was awarded a Sh600 million tender to supply aircraft refuelling equipment for Nairobi’s Jomo Kenyatta International Airport.

Inside sources told the Daily Nation that the company is owned by a humble welder but who has extensive and sophisticated connections at the Kenya Pipeline Company (KPC) head office.


Now in his early 60s, the welder is well-known inside KenPipe, the KPC headquarters, where he is the trusted proxy of powerful officials in inflated tenders.

He is wealthy and owns houses in Nairobi and Kisumu, sources said, but he at times lives at the KPC Outer Ring Road premises and drives a battered Mercedes Benz or a Nissan Patrol. Even his name is a misnomer.

Thanks to his longevity at KPC, Mr Bagman, who should have retired by now, is still the king of tenderpreneurs at the company.

“He is immensely powerful. Even his boss cannot order him to do anything. The man is well connected,” a source at KPC said.

This is the man who ran the Sh600 million racket in Gill House, now under investigations by the Ethics and Anti-Corruption Commission.

If the police manage to crack the case, which is highly doubtful, it will blow the lid off a con-game at KPC where insiders hatch schemes to tailor tenders and award them to select briefcase companies.


It will also unwrap the manifold conflicts of interest and the clandestine business dealings within the company.

While Mr Bagman hides behind his shabby dressing and age, the face of his two companies — Aero Dispenser Valves and Thermodynamics — is a Mr John Huba Wako, who in the company’s profile is listed as operations manager.

His work, as contained in the company’s profile, is to “ensure smooth operation of tendering… keeping track of the stages through which each order is until receipt and payment.”

If everything had gone to plan, the Sh600 million scandal would never have been known. To kickstart this wanton waste, a “Jig inspection” was conducted at the airport. (A Jig is an acronym for Joint Inspection Group, an internationally recognised forum, where experts drawn from the aviation fuel supply industry come together to establish and improve standards for the safe handling and quality control of aviation fuels).

It was after that inspection that KPC decided to purchase some exaggerated number of hydrant pit valves for the airport plus their spares.

Hydrant pit valves are used in aircraft fuelling and comprise a series of components for fuelling aircraft with sufficient pressure and flow to deliver piped fuel throughout an airport.

“There is nothing complex about them,” said an engineer at KPC.


In 2014, new valves had been installed at the airport costing Sh1.5 million each. But in the desire to make quick cash, in the financial year 2014/2015 the management decided that they had to purchase 60 more hydrant pit valves plus their spares at a sum of Sh600 million.

This week, KPC chairman John Ngumi, told us that these hydrant pit valves are still in the stores as they are subject of investigations by the Ethics and Anti-Corruption Commission.

The KPC MD, Joe Sang, also sent a statement confirming that these are “subject of investigations”.

KPC says they bought the big number of pit valves to replace 43 non-compliant valves at the airport. The 17 extra valves were spares.

This particular tender was awarded to Aero Dispenser Valve Limited to supply “hydrant replacements” during what was recorded inside the KPC boardroom as meeting No 24 of the tender committee of February 18, 2015.

The award letter was simple: “Following detailed evaluation of tenders, KPC is pleased to advice you that you have been awarded the tender… inclusive of all taxes.”

The letter of award was sent to the managing director of Aero Dispenser Valves Limited, and signed by then KPC managing director Charles Tanui.

Read the full story here.

SOURCE: Daily Nation