Hedberg takes over reigns at Telkom

In a surprise move, Reuben September has vacated the CEO's chair at fixed-line company Telkom, handing over the reigns to Multi-Links head Jeffrey Hedberg for the time being.

The company made the surprise announcement to shareholders at noon today. It stated: “Having regard to the uncertainty which prevails during such transition periods, Reuben September has agreed with the Telkom Board to step down as group CEO and resign as a director from 7 July.”

Telkom announced early last month that September would step down from the company in November, bringing to an end a 33-year long relationship.

September will, however, stay on in a consultative role until the end of his contract. Telkom says it will announce September's successor in “due course”. In the interim, Hedberg will take over running the company, in the capacity of acting CEO.

Telkom went to great lengths to secure turn-around whiz Hedberg to head up its flagging Nigerian operation, Multi-Links. Telkom announced last July that he would be joining the company.

However, a restraint of trade agreement with Cell C's parent company, Oger, meant the fixed-line operator had to wait for months to get its man.

Hedberg is famed as a turnaround specialist, and was brought in to fix Telkom's Nigerian operation, Multi-Links, which has failed to make a profit since Telkom bought into it three years ago.

Arthur Goldstuck, MD of World Wide Worx, says Hedberg's appointment is indicative of the fact that Telkom is focusing on its operations and needs to be as responsive as possible to the significant changes occurring in the industry.

“Having a CEO who is on his way out during a time like this is equivalent to having a dead hand on the tiller.” Goldstuck says Telkom was in a period of indecision after September's resignation announcement.

Chris Gilmour, Absa Investments analyst, previously said that Hedberg is technically competent and renowned as a turnaround man after the work he did at Cell C. The fact that Telkom had to wait several months before Hedberg could start work on Multi-Links implies the company desperately wanted him, he says.

Hedberg was hired to head up Cell C in May 2006, where he was instrumental in the turnaround of the business. He took on an almost impossible task, given the company's large-scale debt.

Under his leadership, Cell C produced its first profitable results and continued to sustain profit under his guidance. It has also made strides in growing its market share through aggressive campaigns on price.

Hedberg has been tipped as a successor to September, but a permanent appointment is unlikely given the fact that Telkom's majority shareholder is government, which is likely to approve a black person to head up the company, Gilmour has pointed out.

Nombulelo “Pinky” Moholi, who currently heads up Telkom SA, has also been tipped as a likely candidate to head the company.

It is not known, at this stage, who will head up Multi Links.