Kenya's Safaricom gets committee nod for govt security contract

NAIROBI, July 25 Fri Jul 25, 2014 9:52am EDT

NAIROBI, July 25 (Reuters) - Kenya's national security committee has approved plans for a security and surveillance system, clearing the way for a project worth 14.9 billion shillings ($170 million) to Safaricom, its chief executive said on Friday.

The parliamentary committee approved the deal on Thursday after an investigation. It still requires parliament's approval, but the ruling majority backs the plan, members of parliament said.

"Contracts will now be signed. A lot of preparatory work had already started," Chief Executive Bob Collymore told Reuters on Friday, adding it would be worth some 14.9 billion shillings including construction, maintenance and support.

Kenya's largest mobile phone firm will also receive coveted spectrum as part of the payment, which will allow it to roll out fourth-generation (4G) broadband internet services, also known as LTE.

Spectrum remains a hard-to-come-by resource for Kenyan operators and Safaricom has also been experiencing network quality issues due to lack of adequate spectrum.

The latest deal has sparked a row in recent weeks as critics complained that it had been awarded without an open bidding process.

Safaricom had also sought extra capacity through its joint bid with mobile rival Bharti Airtel for the assets of Essar's Yu mobile in April. Safaricom would have secured Yu's spectrum under the deal but regulators have not cleared it.

Asman Kamama, chair of the national security committee, said the committee approved the deal because of the urgent need for the new security and surveillance system after a series of militant attacks.

"We approved because there is this upsurge of terrorism in the country to the extent that now we are losing people," he said, citing last September's attack on the Westgate shopping mall in Nairobi and attacks on the coast in recent months.

"The committee agreed that this deal will actually stem the upsurge of terrorism and other forms of insecurity in the country," he added.

The national assembly will debate the report next week and it is likely to adopt it because the ruling Jubilee coalition backs the deal and holds a majority in the house.

Under the terms of the security contract, Safaricom will install and run a communication and surveillance system that is linked to police stations to help combat crime, initially operating in Nairobi and Kenya's second city, Mombasa.

Rival bidders ZTE of China and Kenyan firm Tetra Radio could not be reached for immediate comment.

($1 = 87.7000 Kenyan Shillings) (Reporting by Duncan Miriri; Editing by Edmund Blair and Jason Neely)

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