EOH investigation findings to be made public soon

Technology services company EOH says that legal firm ENSafrica has concluded its investigation into a number of public sector contracts, amid allegations of corruption and poor governance and compliance.

In February EOH chief executive officer Stephen van Coller wrote an open letter to stakeholders after Microsoft terminated partner agreement with subsidiary, EOH Mthombo. In the letter van Coller promised to clean up the business.

The group recently completed a strategic review of the business and presented a strategic plan to the board which was adopted in late March 2019. It subsequently announced the conclusion of a deal that will see it dispose of a 70% shareholding of enterprise software group, Construction Computer Software (CCS) for R444.4 million.

And in April, EOH reported a headline loss of R1.56 billion for the six months ended January 2019, compared to headline earnings of R458.4 million before.

Revenue, EOH said, remained stable at R8.4 billion (2018: R8.35 billion) and operating costs remain flat, after the removal of once-off items.

“The period under review marks the dawn of a new era for EOH. The appointment of key executive team members, including a new group CEO and CFO, a revitalised strategic intent and transparent approach have greatly assisted the group in navigating its way through the challenges to date and to set the direction for the future,” van Coller said.

He said that a review identified the need to refocus the businesses, including the identification and ultimate elevation of the IP businesses.

“Meaningful progress has been made on implementing this as well as towards addressing legacy governance issues, future-proofing the business and aligning strategic and financial performance,” he said.

In a note on the JSE’s news distribution service on Wednesday (3 July), EOH said: ENSafrica has concluded the investigation commissioned by EOH into public sector contracts and has submitted a forensic report and its recommendations to the board of directors of EOH.

“The board has assessed the findings of the ENSafrica report and is engaging with the stakeholders concerned where appropriate. Relevant findings and associated actions will be made public on or about 16 July 2019, or as required.”

Read: EOH disposes of software unit for R440 million

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EOH investigation findings to be made public soon