The Austrian firm contracted to build and manage the controversial e-toll system in Gauteng has fully acquired the South African companies involved with the collection of toll fees.

According to Kapsch Trafficom’s annual report for 2015/16, in the past financial year it has gained 100% controlling interest in ETC South Africa – the E-toll Collection Company – from 87% in the previous year.

The group achieved this by completely acquiring South African group TMT Services and Supplies (which forms part of ETC) at a cost of R93 million, the report showed.

ETC is a consortium comprised of TMT and Kapsch. Kapsch, through TMT, won the contract to build and operate the e-toll system in Gauteng in 2010.

TMT – co-founded by Douglas Davey, Johan du Toit and Neil Louwrens – approached Kapsch for financial investment to build the Gauteng Open Road Project in 2010. The group also partnered with black-owned Matemeku Investments for its BEE credentials.

At the time of the e-toll build, TMT owned 35% of ETC, while Kapsch TrafficCom AG owned 25%, with Kapsch TrafficCom AB of Sweden owning the remaining 40% stake.

With the new interest however, TMT, its subsidiaries (Berrydust 51 and Mobiserve), ETC and the management of the entire e-toll system and toll collection is now fully controlled by a foreign group.

Remains a big liability

For the full year, Kapsch reported a rise in toll collection from ETC, up 13.6% to E389.3 million (R5.9 billion) – with the biggest portion coming from the EMEA region, primarily South Africa.

South Africa however, still remains the group’s largest liability, with a EUR47 million (R707 million) axe hanging over its books.

Kapsch’s report also shows that it employs 40% of its staff in South Africa – of the group’s 3,500-odd salaried employees, 1,400 are employed locally.

The e-tolling system in Gauteng has effectively failed, with low uptake by motorists in and around Johannesburg. The latest financial information around the system shows that, even with a 60% discount offered to motorists, toll collection has continued to miss required targets.

According to civil action group Outa, the full capture of ETC by a foreign company could hold future implications for the toll scheme, as the group’s 5-year contract with Sanral is set to expire in 2017/18.

The group said that the toll scheme is funneling as much as R70 million a month to ETC and its suppliers, which is now effectively allowing all profits to flow offshore.

Queries were sent through to Sanral asking about the implications for future contracts with ETC and TMT, but BusinessTech did not receive a response by the time of publication.

More on e-tolls

Sanral’s 60% e-toll discount failed miserably: report

60% e-toll discount: this is how much road users paid

ANC Gauteng wants e-toll rethink

E-tolls not going anywhere: transport minister