As one of the successful bidder, Bombadier submitted their best and final offer of R28.8 million per locomotive for the diesel locomotive.

1. 1
HE Sandra McCardell
High Commissioner of Canada
Private Bag X13
Hatfield
0028
Pretoria
Per Email: susan.given-hill@international.gc.ca
14 JUNE 2017
INVOLVEMENT OF BOMBADIER IN TRANSNET LOCOMOTIVE TENDER
CORRUPTION
Ambassador McCardell,
In July 2012, Transnet State Owned Company (SOC) Ltd issued two tenders for a
total of 1064 locomotives 465 Diesel (RFP: TFRACHO – 8609) and 599 Electric
(TFRAC – HO 8609). Between October 2012 and January 2014, Transnet SCO Ltd
assessed submissions by various bidders and a board sub-committee, Acquisitions
and Disposal Committee, chaired by Iqbal Sharma, approved the recommendation of
the acquisition of 599 electronic locomotives of two successful bidders i.e. bidder 1:
Bombadier (40%) and bidder 2: China South Rail (60%). The Committee further
approved recommendation of the acquisition of 464 diesel locomotives of two
successful bidders i.e. bidder 1: China North Rail (50%) and bidder 2: General
Electric (50%).
As one of the successful bidder, Bombadier submitted their best and final offer of
R28.8 million per locomotive for the diesel locomotive. In February 2014, with the
involvement of Regiments Capital (FSP No: 16831) and Trillian Capital (through
Trillian Asset Management (Pty) Ltd FSB No: 42081) as transaction advisors, prices
were illegally inflated from the original final and best prices submitted by the
suppliers. Bombadier submitted a new revised final and best offer of R55.3 million
per locomotive for diesel locomotive.

2. 2
The prices were inflated under the false pretence of escalation of delivery, as the
locomotives were deemed urgent. However, there is prima facia evidence, which
shows that the involvement of Regiments and Trillian Capital corrupted the tender
process and prices were inflated for kickbacks and bribes and as a result, billions of
rands were stolen from Transnet SOC Ltd and Bombadier was involved in this
corruption. It is precisely this kind of corruption that continue to hamper development
efforts for South Africa and Africa as a whole because limited resources are stolen
with the participation and complacence of multination companies. This in turn
undermines all efforts to build a capable state, educate our nation, build strong
economies and reduce poverty and inequality.
Since Bombadier is a Canadian company, I write to you on behalf of the EFF to
demand that you refer the company to Canadian law enforcement agencies and
relevant institutions. I will follow up with your office in due course to get progress
reports on the steps you have taken to report the matter to the law enforcement
agencies and relevant authorities as you are ultimately responsible for your
countries’ entities and their conduct.
I appeal to you to handle the matter with the urgency and the sensitivity it requires as
I await your response.
Yours Faithfully,
Julius Sello Malema
EFF President