Reports alleging that Telkom acting group CEO Jeffrey Hedberg has been acting against the board's wishes and that Telkom is acting in contravention of the Public Finance Management Act have been slammed as “erroneous in several respects” by the fixed-line operator.
This week, national daily newspaper Business Report wrote that it was in possession of a report about the alleged lack of corporate governance at Telkom, compiled by the Communications Workers Union and sent to Telkom last week.
But Telkom argues that many of the issues raised in the report are factually incorrect and devoid of truth.
According to Business Report, the report claims Hedberg and his team presented the board with several options to “save” the loss-making Nigerian subsidiary Multi-Links.
The article claims one of the options included selling 80% of the business's network to Etisalat, a suggestion allegedly rejected by the board of Telkom. However, the parties still pursued the arrangement.
The article cited the following quote from an unmade executive: “In the interim, it is common knowledge to the entire company that Multi-Links acting chief executive and acting CSMO (chief sales and marketing officer) are involved in discussions with Etisalaat (sic) regarding the merger/sale due to the absence of viability of the company. This absence of viability (was) totally created and (is) currently still being engineered by themselves”.
Telkom hits back
The chairman of the board of directors of Telkom, Jeff Molobela, who is also a member of the board of Multi-Links, Telkom's Nigerian operation, has confirmed that the management teams of Telkom and Multi-Links were given a mandate to investigate various strategic options for Multi-Links.
“We have received a number of expressions of interest, which will be evaluated and quantified over the next quarter by the management team. At no time did Telkom acting group CEO Jeffrey Hedberg act against the board's wishes, as indicated in the headline and article in a daily newspaper on Thursday this week. Anyone who suggests otherwise is being mischievous and acting maliciously,” he maintains.
Damning reports
Business Report published a second article today, based on the same report. This time the newspaper stated that serious allegations of contraventions of Telkom processes and the Public Finance Management Act, along with nepotism, bribery and corruption, are listed in an explosive whistle-blowing report.
According to the article, the report states that several large Telkom contracts, including those of Blue Label Telecoms and Altech West Africa, were not reviewed and approved by Telkom's legal services in line with its governing structures, delegation of authority and procurement processes.
“Most of the contracts were allegedly initiated and concluded under former chief executive Reuben September without the knowledge of the management at Multi-Links, Telkom's loss-making Nigerian subsidiary, except for its chief executive at the time, Thami Msimang, and its chief financial officer, Hasnain Motlekar. They allegedly allowed the payments to go through knowingly,” stated the newspaper.
Telkom has issued a statement regarding this article as well: “The board of directors and executive management of Telkom have confirmed that they have received a document which was sent to the media. Telkom believes it is unfortunate that the document is a faceless one.
“Some of the issues raised in the document are not new to Telkom and have already been dealt with.
“Any new issues will be discussed by the Audit and Risk Committee of the Telkom board of directors, which will meet in the week commencing 6 December to review the contents of the document and determine the way forward,” concludes the company.
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