More share dumping at Pinnacle

Pinnacle Holding executive director, George Wiehahn has disposed of additional shares in the group on Thursday, amid an investigation by the JSE following the arrest of another executive director, Takalani Tshivhase.

In a SENS announcement, Pinnacle stated that Wiehahn placed 53 trades totalling 161,518 shares at a value of R2.7 million on Tuesday (25 March).

Pinnacle lost approximately 50% of its market value on Tuesday and Wednesday after the South African Police Service (SAPS) announced on Monday (24 March) that Pinnacle Holdings executive director, Takalani Tshivhase had been arrested on 5 March 2014 on charges of bribery.

Tshivhase allegedly offered a lieutenant general in the technology management environment of the SAPS R5 million to secure a multimillion rand tender for his company.

In response to the allegations, Pinnacle said that “Mr Tshivhase denies all allegations of attempted bribery, and will defend the charges.”

Shares in Pinnacle rebounded on Thursday (27 March), adding 13.5% or R1.55 to R13.00 on the local bourse, shortly before 17:00.

Trade timeline

According to SENS announcements, Tshivhase and Pinnacle Holdings CEO, Arnold Fourie both disposed of shareholding in the company between the former’s arrest (5 March) and the SAPS media release on the matter (24 March):

On 14 March, 2014, Fourie disposed of 1,200,000 shares at a price of R19.17, totalling R23 million.

Also on 14 March, Executive director George Wiehahn sold 80,000 shares, totalling over R1.6 million.

Then, on 19 March, 2014, Tshivhase completed three sale trades totaling 200,000 shares at a share value of R20.00, totaling R4 million.

In an interview on BusinessDay TV, Fourie rejected any insider trading. He also reiterated that Pinnacle backed its executive.

In a SENS announcement late on Wednesday afternoon, Pinnacle said:

The company, acting on legal advice, made the announcement immediately that a charge was formally made against Mr Tshivhase. The making of the charge on Monday, 24 March 2014, was the moment at which criminal proceedings were initiated and was the first appropriate time for the Company to report thereon. Prior to the bringing of the charge, it was a matter of speculation whether any charge would, indeed, be brought.

The position of Mr Tshivhase in the company:

“In the light of the bringing of the charge, Mr Tshivhase has requested the Company, and the company has agreed, to grant Mr Tshivhase leave of absence with immediate effect until the criminal proceedings have been concluded at which time Mr Tshivhase´s association with the Company can be reviewed,” Pinnacle said.

Comment on the likely outcome of any prosecution:

“The company has previously noted that on the evidence thus far available to it, it has no reason to doubt the veracity of Mr Tshivhase´s denial of the allegations of any impropriety. The matter is now sub judice and the Company has been advised that it would not be proper to elaborate further on this aspect of the matter.”

Datacentrix meanwhile announced that Tshivhase has voluntarily stepped down from its board, pending an investigation.

He was appointed as a non-executive director of the company in November 2013
subsequent to Pinnacle having acquired a 33.38% beneficial interest in the securities of
Datacentrix.

The IT services company stressed that Tshivhase is not involved in the day to day operations of Datacentrix.

“In light of the above, Mr Tshivhase has voluntarily stepped down from the Board with immediate effect until such time that the SAPS case is finalised, at which time Mr Tshivhase’s association with the Company will be reviewed,” it said.

More on Pinnacle

Pinnacle CEO denies insider trading

Pinnacle shares crushed on bribery charge

Tech businessman arrested for alleged corruption

Pinnacle lifts interim earnings

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