McKinsey and Transnet finalise terms for R870m in fees to be returned

McKinsey and Transnet finalise terms for R870m in fees to be returned

Transnet and McKinsey & Company announced on Tuesday that they had finalised the settlement agreement on the fees McKinsey committed to return to Transnet at the state capture inquiry in December 2020.

The full and final settlement of R870m includes the fees paid to McKinsey in respect of the projects undertaken with Regiments Capital, plus interest.

At the commission last year, management consulting firm McKinsey announced it had undertaken to repay all fees paid to it for work it did on Transnet and SAA contracts. The undertaking comes after discussions initiated by the commission, which had investigated these contracts.

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In 2019 the commission heard how former Transnet CFO and Gupta allyAnoj Singhirregularly appointed Regiments Capital as transaction advisers in the scandal-riddled deal for1,064 locomotives. Regiments was paid R305m for its role in structuring the deal, which was worth R32bn.

In 2018, McKinsey repaid the full amount of the fees it had earned on its Top Engineers MSA contract with Eskom, for work on an Eskom project for which Gupta-linked Trillian Management Consultinghad also invoiced Eskom.

At the time the commission said McKinsey did not work alongside either Regiments or Trillian at any state-owned enterprises other than Eskom, Transnet or SAA.