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Pinnacle embroiled in corruption allegations

Staff Writer
By Staff Writer, ITWeb
Johannesburg, 27 Sept 2016
Pinnacle Holdings says Pinnacle Africa never requested nor expected nor received any special treatment or favours from any of its customers.
Pinnacle Holdings says Pinnacle Africa never requested nor expected nor received any special treatment or favours from any of its customers.

Pinnacle Holdings has been embroiled, through one of its subsidiaries, in alleged corruption charges against a South African National Defence Force (SANDF) member.

The company advised shareholders in a SENS announcement that Pinnacle Micro, a major subsidiary of Pinnacle that previously traded as Pinnacle Africa, has been mentioned in the charging and court appearance of brigadier-general Leon Eggers of the SANDF.

"Eggers is accused of favouring Pinnacle Africa and another supplier in the award of business, by using his official position to obtain from them private gifts or benefits for himself during the performance of his duties," Pinnacle says.

The group says Pinnacle Africa dealt with Eggers and the SANDF over a number of years but did so "in the same manner as any other customer".

"Pinnacle Africa networks with its customers and invites customers to many events, including sporting events, at Pinnacle Africa's expense. Pinnacle Africa has never requested nor expected nor received any special treatment or favours from any of its customers, in return for any such entertainment provided by it, and it would never do so."

Pinnacle's share price fell 17.4% on the news, closing at R15.20 on the Johannesburg Stock Exchange yesterday.

The company is no stranger to controversy. In March 2014, executive Takalani Tshivhase was arrested after he allegedly tried to bribe a senior police official with R5 million so the company could win a R182 million supply contract.

The news caused the group's share price to lose around half its value and prompted the Financial Services Board (FSB) to look into the possibility of insider trading as shareholders were only told 20 days after the fact.

The FSB's investigation was later dropped, and charges against Tshivhase withdrawn.

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