Tuesday, June 18, 2024

Michael Macharia’s Seven Seas to get Sh. 1 billion compensation from State

Michael Macharia and his tech company Seven Seas Technologies are set to receive Sh. 1 billion compensation from the government after a breached contract.

The payment comes after the National Assembly’s Budget and Appropriation Committee set aside the funds for his compensation.

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According to a report that appeared in a local business newspaper, the committee has set aside Sh. 1.55 billion allocation for the Office of the Attorney General, out of which Sh. 1 billion be used to compensate Macharia and his company.

This payment, though, will be a portion of the total amount of Sh. 1.58 billion that the government was ordered to pay Seven Seas Technologies, where Macharia holds a 60 per cent stake.

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Macharia had won a legal battle against the government following the cancellation of a tender he had won to wire 98 government hospitals. This was after Aaron Ringera, a retired judge and arbitrator found that the government had erred in terminating the multibillion tender that had been awarded to Seven Seas.

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The tender awarded to Seven Seas had been worth Sh. 4.7 billion. It was awarded in October 2017 for the provision of the Managed Equipment Service (MES) and teleradiology system that would have allowed doctors in major hospitals such as the Kenyatta National Hospital to read CT Scans, X-Rays, and MRIs for the treatment of patients in far-flung hospitals in the country.

This contract was however terminated by the Ministry of Health in 2019 prompting Michael Macharia and his company to engage the government in a legal fight for compensation. The Ministry had claimed in the cancellation that the company did not have the necessary financial wherewithal to finance the project.

Seven Seas protested that the government through the Ministry of Health had failed to offer the company a Letter of Support to help it access financing from KCB Group as is the norm is such tender arrangements.

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