POLITICS

Home Affairs cancels "Who Am I Online?" contract - GijimaAST

Company contests department's view that the contract is invalid

GIJ - Gijima Ast Group Limited - Who am I online contract - Legal dispute

GIJIMA AST GROUP LIMITED (Incorporated in the Republic of South Africa) Registration number 1998/021790/06

 ("Gijima AST" or "the company")

WHO AM I ONLINE CONTRACT - LEGAL DISPUTE

The conclusion of the Who Am I Online contract signed in June 2008 between the Department of Home Affairs and GijimaAst is a matter of public record (see report).

The project involves the design, development and implementation of an integrated core system for the Department of Home Affairs including all business processes of both its Civics and Immigration Divisions. 

After close of business on 13 April 2010 the Department of Home Affairs sent a letter to GijimaAst in which the Department contended that the contract is invalid.

GijimaAst has taken legal advice and through its lawyers disputes that contention as the company maintains that the contract is valid and enforceable.

If the matter is not resolved it is possible that litigation on this issue will follow.

GijimaAst has fulfilled its obligations and continues to perform in terms of the contract with an extensive and experienced team dedicated full-time to the project. GijimaAst is one of the largest ICT companies in South Africa with extensive experience of implementing complex projects in the public and private sectors.  Consortium partners on the project include inter alia multinational companies such as Daon, the world leader in identity management systems, IBM and Siemens.

There has previously been no suggestion from the Department of Home Affairs that the contract is not valid and enforceable. GijimaAst has been performing in terms of the contract for some two years and the Department`s claim that the contract is invalid was therefore completely unexpected.

The board of directors is currently considering all options available to the company and should the Department of Home Affairs persist in disputing the validity of the contract, GijimaAst will consider inter alia seeking a declaratory order from the High Court affirming the validity of the contract.

If this dispute continues it could have a material impact on the earnings of GijimaAst as the contract currently represents approximately 15% of GijimaAst revenue.

GijimaAst will continue to keep shareholders informed of further developments.

Statement issued by the JSE SENS Department April 15 2010

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