Local operators of global technology firm Siemens AG, which is building 1,000km high voltage direct current lines between Ethiopia and Kenya, is seeking the court’s protection to stop a firm that is threatening to file an insolvency petition over a disputed bill.
Siemens says in court filings it is apprehensive that if not restrained by the court Afrikon Limited might go ahead with its threat to file a winding up petition causing it reputational damage.
Siemens was initially awarded the contract in a consortium with construction company Isolux Corsan.
The tender was placed by the Ethiopian Electric Power Corporation and the Kenya Electricity Transmission Company and funded by the World Bank.
At the centre of the dispute is Sh11.9 million outstanding debt that accrued from sub-contracted work commissioned by Isolux, which has since exited the project after being declared insolvent.
“A permanent injunction do issue barring the defendant… from carrying out any of the threatened actions contained in the letter dated July 16, 2018…and specifically restraining the defendant from instituting or commencing or filing any proceedings related to the alleged insolvency of the applicant on the account of Sh11.9 million claimed in the said letter,” reads part of Siemens’ petition presented in the High Court.
The firm says it has no obligation to honour the amount demanded by Afrikon, adding that the case can jeopardise the infrastructure project that is worth about Sh45 billion.