Ray Leonard has resigned as CEO of Global Technology (Glotec) with immediate effect, although he is planning to buy the group`s banking division.
Graeme Victor, formerly CEO at Tiscali WorldOnline, has been named as Leonard`s replacement, while Leonard is to stay on as a non-executive director at Glotec.
Glotec says it has decided to dispose of its interests in the banking division and certain parts of the professional solutions division as part of its consolidation and restructuring process.
"This will allow the company to focus on and further enhance its market position in the areas of business intelligence, insurance systems and the remaining part of professional solutions, being the area of manufacturing and distribution systems," it says in a statement issued on the JSE`s SENS news service this morning.
A consortium led by Leonard has made an indicative offer for the banking division, and the group says talks are under way.
The deal will be subject to various conditions, including a written agreement, independent advice on the fairness of the terms, and shareholder and regulatory approval.
At the same time the group is engaged in a legal dispute with subsidiary Global Technology Australasia (GLA), which reported last month that Glotec had agreed to dispose of its entire interest in the subsidiary and that Leonard had resigned as a GLA director.
"The board did not approve this announcement," Glotec says.
"This reported disposal of Glotec`s entire interest in GLA is a matter of dispute and forms the subject matter of litigation proceedings instituted against Glotec."
It says its attorneys are opposing the claim.
It was reported in April that Glotec`s auditors had expressed concern about Glotec`s ability to continue as a going concern, saying the group depended on the introduction of new capital and a cost reduction programme which had been instituted previously.
Glotec incurred an attributable loss of R379 million for the year to end-December 2002. The balance sheet recorded current liabilities of R243.57 million, almost double current assets of R124.83 million.
The group, which has been planning a rights issue for some time, said last month that it was selling its 15% stake in Swiss-listed Temenos for R51.6 million. It has also said that it has implemented major cost cuts, with the elimination of R76 million in costs per year.
Leonard said at the time the Temenos deal was announced that the cost-reduction programme had already had the effect of reducing the debt-to-equity ratio to 1:1, with total debt at less than R40 million.
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Auditors raise doubts about Glotec
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