Telkom rejects HP’s alternate equity plan
Telkom has refused to give any new supply contracts to Hewlett-Packard (HP) after rejecting the company's equity equivalent projects, an executive close to a multinational ICT company, said yesterday.
This comes after a series of warnings from Telkom that it would stop doing business with suppliers that would not sell at least a 30 percent stake to empowerment partners, as required by the information and communication technology sector charter.
HP became the first multinational to gain government approval for the controversial equity alternative schemes that allow multinational companies to bypass the selling of shares to black investors in exchange for other empowerment programmes such as skills development.
HP announced in August that it would launch a R150 million BEE project, which would include a training institute for staff and black graduates.
Telkom's refusal to acknowledge HP's scheme means that government approval of such schemes may not translate into acceptance from local firms.
The executive, who spoke on condition of anonymity, said the HP dispute was affecting companies linked to the US technology group.
Yesterday Telkom did not confirm nor deny that it had rejected HP's equity equivalent programme. Spokesperson Lulu Letlape would only say: "In terms of legislative frameworks, Telkom can set its own procurement and BEE requirements with all our suppliers, domestic and international."
HP was equally tight-lipped but insisted Telkom was still its client.
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