Old Mutual board chairperson Trevor Manuel says Peter Moyo, the company’s twice-fired chief executive, is allowed into its swanky offices in Sandton to either have coffee in the cafeteria or to have a meeting on the first floor with other employees.
On Thursday, Old Mutual sent a letter to Moyo indicating that it wishes to “de-escalate” the ongoing dispute between itself and Moyo by not pursuing any further legal action against him. In the letter, Old Mutual suggests that “that both parties should seek to avoid further proceedings that would not serve to resolve the central issues that exist between them.”
However, the company says Moyo is not allowed to resume his duties and has no access to his desk — a condition disputed by Moyo’s lawyer, Eric Mabuza.
“Withdrawal by Old Mutual of its undertaking and threats to bring an urgent application means that Mr Moyo is free to return to work at any time,” Mabuza said in a statement.
In its correspondence, Old Mutual pleaded with Moyo to not return to his workplace, as he has done twice before “with or without a press entourage” until Judge Brian Mashile has made a ruling on his employment status.
Moyo was fired in June after being suspended in May. Mashile ruled in Moyo’s favour in July, ordering Old Mutual to temporarily reinstate him as its chief executive pending Part B of his application to have the company’s directors declared as delinquent according to the Companies Act. Old Mutual says that Moyo should not resume his duties until the outcome of its appeal is handed down. The company believes that its second notice of termination against Moyo, which he received in August, is still valid.
The nearly four-month conflict has seen Old Mutual’s share price falling by 16%, wiping more than R15-billion off its market capitalisation. Speaking at a press conference in Johannesburg on Friday, Manuel said the board has been given instructions from its shareholders to “not put money on the table” to resolve the dispute.
“We’re going to have to find a medium to resolve this matter we don’t want to be held in neglect or in contempt by our shareholders but we need to solve this thing in some way.”
The notice pay is R4-million, he [Moyo] has got it in his bank account already. I don’t know what else he might expect,” Manuel said.
Manuel added that the company and the board did not wish to add any unnecessary heat to the already volatile situation between the company and Moyo by pursuing any litigation against him. He says the board’s decision to defend itself was because it owes a fiduciary duty to its shareholders and all other stakeholders to see the matter through to its logical conclusion.
“We don’t want to be in the courts and we haven’t wanted to continue being in the courts. The matter must come to a conclusion. The share price needs to pick up and the people need to be confident,” he said.
At the heart of the dispute between Moyo and the 174-year-old company is Moyo’s sacking in June after he allegedly pocketed R30-million worth of dividends from investment company NMT Capital, which he co-founded and holds a 30% percent stake in. Old Mutual also holds a 20% stake in the company.
Manuel said that the company was aware of Moyo’s stake in NMT and therefore devised a special protocol was designed in his contract to govern Moyo’s the potential conflict of interest. “It was in the fact that the conflict became unmanageable that the board had to take a decision that the unmanageability related to the fact that Old Mutual had preferential shares that were outstanding.”
Manuel said the breakdown of the relationship between Moyo and the board occurred after it “came across certain information that hadn’t been given to it” regarding the payout of the NMT dividends. Manuel claims that Moyo failed to disclose to the board that he chaired an NMT board meeting where NMT failed to deal with its obligation to Old Mutual distribute part of it’s R105-million profit made from the sale of it stake in real estate company, Growthpoint.
“When you put money in your pocket and leave the needs of old mutual aside there is just an unmanageable conflict of interest,” Manuel said.