- October 30, 2014
- Posted by: admin
- Category: General
QUESTIONS are likely to be raised at Hosken Consolidated Investment’s (HCI’s) annual general meeting on Thursday about chief financial officer Kevin Govender’s trade in Ellies stock.
The unauthorised buying of Ellies shares led to the suspension and resignation of HCI executive chairman Marcel Golding. Mr Golding faced disciplinary charges after he bought about R24m of Ellies shares on behalf of Sabido, the HCI subsidiary that houses its digital media assets, including e.tv.
On Thursday at the AGM shareholder activist Theo Botha is expected to question Mr Govender’s trades in Ellies’s shares.
Mr Govender was named acting CEO of Sabido after Mr Golding’s resignation this week. The issue of Mr Govender’s trading in Ellies shares was stated in Mr Golding’s Labour Court application to have his disciplinary hearing declared unlawful.
Mr Golding said he first told HCI CEO Johnny Copelyn and Mr Govender of the share deals in August last year and held several informal discussions with them about it before the HCI board meeting of August 6 that led to him facing disciplinary charges.
In his court affidavit Mr Golding said: “At one point Govender did say to me that he had had cause to have misgivings about the management of Ellies, which made Govender sell his own Ellies shares. This was the first time I had heard Govender was actually trading in Ellies for his personal account.”
Mr Copelyn said on Wednesday he was satisfied Mr Govender had not transgressed any rules or ethics even though he became aware of Mr Govender’s trading in Ellies shares only recently.
“Kevin told me he had sold the Ellies shares held in a family trust account in January. We (HCI) were not buying Ellies shares so I did not see anything wrong with that and I was satisfied with Kevin’s explanation. I am satisfied he had no inside information from being a director of HCI,” he said.
Mr Copelyn said HCI was not a share trading company, but one that took controlling or strategic stakes in businesses. “Our share transactions only commence once we have decided on a mandate at board level to take a strategic stake. Marcel’s mistake was that he started (buying Ellies shares) without that mandate.”
HCI nonexecutive director, chairman of its audit committee and would-be chair of Mr Golding’s disciplinary hearing Lesley Maasdorp said he was not aware of Mr Govender’s trade in Ellies.
“Those guys (Mr Golding, Mr Copelyn and Mr Govender) are executive directors and have conversations between each other all the time. The information in Mr Golding’s statement was all new to us (nonexecutive directors).”
On Wednesday the chief operating officer of HCI subsidiary e.tv, Bronwyn Keene-Young, resigned and in a letter to staff confirmed attempts at political interference.
The resignation of Ms Keene-Young, who is married to former HCI executive chairman Mr Golding, follows that on Monday of former cabinet minister Barbara Hogan, who sat on HCI’s audit committee.
Mr Copelyn said he was disappointed in Ms Keene-Young’s resignation as she had contributed to the growth of e.tv but he understood her situation.
Mr Botha said: “This raises a flag over Mr Govender. Maybe HCI should be conducting an investigation into his trades of Ellies shares. Was Mr Govender trading on information that he received as a director of HCI?”
Mr Botha also said the events at HCI were having a terrible effect on e.tv’s reputation. “You can see from the e.tv website people are saying they will stop watching it. If viewership falls, it will eventually affect advertising and then revenue,” he said.
Media surveys have shown e.tv news has about 2.5-million viewers a day, about twice as many as the SABC’s English-language news service.
Source: BDLive – Paul Vecchiatto