Kuramo Capital’s fund management arm Gen Africa has won a bid to manage the Sh31 billion pension scheme for civil servants that was rolled out in January 2021.
Gen Africa managed to overturn a decision by the Public Service Superannuation Scheme (PSSS) board to end its contract after the company came top among 10 bidders last year.
The PSSS board had attempted to cancel the procurement process at the tail end, proposing to hire three fund managers instead of one.
Gen Africa protested the move at the Public Procurement Administrative Review Board (PPARB), saying, the cancellation would help their rivals who were now aware of their bids, and could alter their applications to its disadvantage.
PPARB said it had given the PSSS 30 days to complete the process, which, it added, “had been terminated on December 20, 2021, over alleged material governance issues.”
The lucrative tender attracted 10 bidders including Old Mutual Investment Group, Sanlam Investments East Africa Limited, Co-Optrust Investment Service Limited, ICEA Lion Asset Management, African Alliance Kenya Investment Bank, Britam Asset Manager Limited, Absa Asset Management Limited, CIC Asset Management Limited, UAP Life Assurance Limited and Gen Africa Asset Managers.
At the end of the initial stage of evaluation, five tenders were found non-responsive while five proceeded to the next stage.
At the second stage, one bid was dropped leaving four companies chasing the three-year contract.
The PSSS Board of Trustees resolved to instead procure three fund managers and instructed management to re-advertise the services sought.
Gen Africa argued the move would disadvantage the tenderer with the highest combined score and help other tenderers who will use that marking scheme to improve their performance if the tender is re-advertised.
PPARB agreed with them and said resolution to get additional fund managers should have progressed separately.
“With this, we can confidently deduce that indeed the 2nd respondent’s board of trustees wanted three fund managers but this did not stop procurement of each of the three fund managers to be undertaken separately,” the board said.
The process of recruiting a fund manager for the new State pension scheme stalled despite the launch of the scheme last year.
The Public Service Superannuation Scheme has already awarded three banks: NCBA, Stanbic, and Co-op as custodians of the funds collected from over 350,000 civil servants.
These include police officers and teachers, who started contributing to their own pension savings scheme.
