South Africa Wants Payment From Colluding World Cup Builders

South Africa’s government is putting pressure on construction companies to make further payments as punishment for rigging contracts to build stadiums for the 2010 FIFA Soccer World Cup and other projects.

Antitrust authorities fined 15 builders, including Murray & Roberts Holdings Ltd. (MUR) and Aveng Ltd., a total of 1.5 billion rand ($141 million) in June 2013, after a probe that spanned almost four years found they colluded to drive up prices.

“The 1.5 billion rand in penalties is not the end of the story with the construction industry,” Economic Development Minister Ebrahim Patel told lawmakers in Cape Town today. “We are now in discussion with the construction industry on a restitution package for their collusion and price fixing.”

The Competition Commission probe found that companies held meetings to rig profit margins on the construction of six stadiums ahead of the soccer tournament. Murray & Roberts, South Africa’s biggest listed builder, and competitors met twice and agreed to exchange cover prices, allocate tenders and aim for a 17.5 percent margin, according to documents on the competition tribunal’s website. The papers also detailed collusion on projects ranging from roads to offices.

“We are in discussions with the government on a settlement package, which the government and the participating construction companies will unveil at an appropriate time yet to be mutually determined,” Webster Mfebe, chief executive officer of the South African Forum of Civil Engineering Contractors, said in an e-mailed response to questions.

Murray & Roberts was fined 309 million rand, Aveng Ltd. (AEG) 307 million rand, Wilson Bayly Holmes-Ovcom Ltd. 311 million rand and Stefanutti Stocks Holdings Ltd. 307 million rand.

Patel didn’t specify which companies are being targeted to make additional payments or how much the government expected to raise.

To contact the reporters on this story: Kamlesh Bhuckory in Johannesburg at kbhuckory@bloomberg.net; Mike Cohen in Cape Town at mcohen21@bloomberg.net

To contact the editors responsible for this story: Simon Thiel at sthiel1@bloomberg.net; Nasreen Seria at nseria@bloomberg.net John Bowker, David Risser

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