Telkom CEO angry over CIPC sanctions
Sunday Times has reported that Telkom CEO Sipho Maseko has hit back at the Companies and Intellectual Property Commission (CPIC) which gave him a grilling last week.
The CIPC questioned Maseko’s ability to head a listed company, and ordered Maseko to attend a course on corporate governance and directors’ duties within 90 days.
Maseko hit back saying: “It was [probably] some small-time bureaucrat trying to shake his weight around. It’s a very bad compliance notice. It was badly arrived at. It’s procedurally unsound.”
The spat revolves around a dubious September 2013 loan of R5.96 million awarded to now-suspended Telkom CFO, Jacques Schindehütte.
The commission also ordered Telkom to recover the loan from Schindehütte, although this demand was moot since this had already been done in January 2014.
Schindehütte used the loan to buy 243,700 Telkom shares at R24.45 each on 30 September 2013, a day before the company went into a closed period, preventing trading by those with market sensitive information until the end of November 2013.
Telkom CEO Maseko and chairman Jabu Mabuza approved the loan. A week after Schindehütte’s share purchase, Telkom issued a statement saying headline earnings for the six months to September were expected to be 20% higher than the previous corresponding period. The company’s share price rose in response, raising questions about the timing of the events.
Maseko admitted in November that the loan made to Schindehütte “may not have been in compliance with the provisions of the companies act”.
Maseko previously said that Telkom’s disciplinary hearing involving suspended CFO Schindehütte has been a major distraction for the company. Maseko is trying to lead a recovery for the company, having to correct years of blunders and restore value to shareholders.
The details of Schindehütte’s suspension have not been made public. Maseko clarified that Schindehütte’s suspension had nothing to do with fraud, inappropriate sexual conduct, or his management style.
Further speculation that it was to do with the hiring of an investor relations manager outside of due process has been tempered with the fact that former CEO Pinky Moholi authorised that appointment.
This past week, Maseko said that Schindehütte was not blameless, with the CEO saying that when he approves an idea he expects correct processes to be followed. “[Schindehütte] failed in that” said Maseko.
Source: Sunday Times (2 March 2014)
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