Old Mutual Limited Update on Peter Moyo and Termination of Employment (5811C)
June 18 2019 - 2:30AM
UK Regulatory
TIDMOMU
RNS Number : 5811C
Old Mutual Limited
18 June 2019
Old Mutual Limited
Incorporated in the Republic of South Africa
Registration number: 2017/235138/06
ISIN: ZAE000255360
LEI: 213800MON84ZWWPQCN47
JSE Share Code: OMU
MSE Share Code: OMU
NSX Share Code: OMM
ZSE Share Code: OMU
("Old Mutual" or "the Company")
Ref 30/19
18 June 2019
UPDATE ON PETER MOYO AND TERMINATION OF EMPLOYMENT
The Old Mutual Board ("Board") refers stakeholders to previous
announcements regarding the suspension of the Old Mutual CEO, Mr
Peter Moyo, as released on SENS on 24 May 2019, and various
subsequent media reports.
The Board wishes to inform stakeholders that Mr Moyo has, on 17
June 2019, been given notice of termination of employment. The
Board considers it appropriate to provide certain material facts
that have led to this.
There is a duty on directors of all institutions to be vigilant
regarding the management of conflicts of interest. The importance
of this duty has been highlighted by a number of recent corporate
governance breakdowns within both the private and public
sector.
Mr Moyo's conflicting interest in the NMT group of companies was
declared upon his employment and was governed by a specific
protocol to regulate the conflict of interest in addition to the
general obligations flowing from his employment contract. During
the latter half of 2018, the Old Mutual Related Party Transaction
Committee (RPTC), a Committee of Independent OML Board members,
requested a report on Mr Moyo's related party transactions, and
confirmation that the terms of his employment contract had been
adhered to.
During this process, various concerns emerged relating to Mr
Moyo's conduct in relation to his conflicting interest. One of the
concerns raised involved two declarations of ordinary dividends by
NMT Capital during 2018 totalling R115m. The resultant benefit to
Mr Moyo and his own personal investment company was R30.6m. These
dividends were declared in breach of Old Mutual's rights as
preference shareholder, since arrear preference dividends were
unpaid at the time and, at the time of the second dividend
declaration, the preference share capital was redeemable. The
preference share capital remains unpaid. Mr Moyo chaired the board
meeting of NMT Capital at which the second ordinary dividend of
R105m was declared.
These matters were investigated and reported to the RPTC in
February 2019. The RPTC reported to the OML Corporate Governance
and Nomination Committee (NomCom) in March 2019. This was followed
by engagements, both through members of the RPTC and Old Mutual's
legal counsel, with the NMT Group, as well as with Mr Moyo
personally, in an effort to secure information relevant to these
events. NomCom considered these matters at several meetings during
April 2019. The Board deliberated on them at two meetings during
May 2019.
The Board has not been provided with an acceptable explanation
why, in clear contravention of the relevant preference share
agreement with Old Mutual as well as Mr Moyo's employment
obligations, ordinary dividends were declared whilst debt to Old
Mutual was outstanding. On 23 May 2019 the Board discussed these
matters at length and considered its options, noting its duties
towards its stakeholders. The Board came to the conclusion that
there was a material breakdown in trust and confidence in Mr
Moyo.
After reaching this conclusion and in the course of 23 May the
Board engaged with Mr Moyo regarding the possibility of an agreed
separation, but no agreement could be reached on this. The Board
decided that in the circumstances it was appropriate to suspend Mr
Moyo. This was announced on 24 May 2019. Mr Moyo's actions since
the suspension contravened his fiduciary duties to Old Mutual, his
contract of employment and his notice of suspension. Following
unsuccessful attempts to engage on the terms of separation, the
Board has now resolved to give notice of termination of
employment.
The Board will shortly initiate a process to appoint a new CEO.
This process will follow our recruitment policies and the requisite
Board approvals. Iain Williamson will continue to act as CEO for
Old Mutual, until further announcements are made.
Sponsors
Johannesburg Stock Exchange Merrill Lynch South Africa (Pty) Limited
Namibia PSG Wealth Management (Namibia) (Proprietary)
Limited
Zimbabwe Imara Capital Zimbabwe plc
Malawi Stockbrokers Malawi Limited
Enquiries
Investor Relations
Sizwe Ndlovu T: +27 (0)11 217 1163
Head of Investor Relations E: tndlovu6@oldmutual.com
Communications
Tabby Tsengiwe T: +27 (11) 217 1953
Head of Communications M: +27 (0)60 547 4947
E: ttsengiwe@oldmutual.com
Notes to Editors
About Old Mutual Limited
Old Mutual is a premium African financial services group that
offers a broad spectrum of financial solutions to retail and
corporate customers across key markets segments in 14 countries.
Old Mutual's primary operations are in South Africa and the rest of
Africa, and it has niche business in Asia. With over 170 years of
heritage across sub-Saharan Africa, we are a crucial part of the
communities we serve and broader society on the continent.
For further information on Old Mutual, and its underlying
businesses, please visit the corporate website at
www.oldmutual.com.
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END
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