Transnet CEO quits after mounting pressure
Two top executives at South Africa’s beleaguered state ports and rail operator quit after facing criticism by mining companies and business lobby groups over their failure to arrest the company’s decline.
Transnet SOC Ltd. Chief Executive Officer Portia Derby will step down at the end of October, while Chief Financial Officer Nonkululeko Dlamini will leave a month earlier, the company said in a statement on Friday.
The board appointed Michelle Phillips, chief executive of Transnet Pipelines, as acting group CEO with effect from Nov. 1.
Volumes of iron ore and coal shipped through Transnet’s freight rail network for export have dropped because of issues including vandalism, idle locomotives and cable theft. Miners and labour unions have called for a turnaround at the company as the slowdown of shipments limits profits and threatens jobs.
Glencore Plc and Seriti Resources Holdings Ltd., over the past two weeks have started talks to cut hundreds of jobs in South Africa as their ability to export coal is stymied by inefficiencies at the freight company.
Dlamini has been appointed CFO of Telkom SA SOC Ltd, the company said in a separate statement on Friday.
South African Public Enterprises Minister Pravin Gordhan pledged on Sept. 1 to implement a “radical plan” for Transnet and stem the deterioration of its operational and financial performance. The government already revamped its board in July and appointed a former mining executive as its new chairman.
Transnet’s rail operations were also affected by a strike last year, floods and power supply disruptions caused by state-owned utility Eskom Holdings SOC Ltd.’s inability to meet demand, it said in its latest results.
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