Maanda Manyatshe resigned from cellphone company MTN recently in a move intended to distance MTN from damaging allegations against the former MD. The allegations, which were first published in the Mail & Guardian, relate to Manyatshe’s days as Post Office CEO, when he is said to have improperly pushed through a contract to revamp post office branches worth R100-million.
MTN shares rose more than 4% following the announcement on Monday that Manyatshe was resigning with immediate effect. The cellphone giant announced that Brian Gouldie, executive for consumer business, would take up the position of acting MD.
In a statement issued this week Manyatshe said he was aware that the Post Office allegations might have a negative effect on MTN and chose to resign to “uphold MTN’s reputation and image”.
He added that his resignation gave him the opportunity to focus on his legal action against the Post Office. Manyatshe is reportedly drawing up a civil claims suit against the Post Office for R100-million in damages.
Business Report, however, disputes Manyatshe’s denial that he was asked to resign. It cites sources close to Manyatshe saying that he “felt that he had been let down when asked by the MTN board to tender his resignation”.
Approached for a response to these allegations, Bart Henderson, an investigator hired by Manyatshe to investigate the claims against him, responded: “We are not talking to the Mail & Guardian.”
The M&G first reported on Manyatshe’s dubious activities in September after a judge dismissed his attempt to interdict the story. Manyatshe successfully prevented publication of the story for a week while his interdict application was heard, but Judge Suretta Snyders dismissed the application with costs.
The story of Manyatshe’s alleged corrupt activities emerged from the affidavits of current Post Office CEO Khutso Mampeule, who asked the police to investigate Manyatshe and others involved in the contract awarded to refurbish post office branches. The parties under investigation were the company that received the award, Vision Design House (VDH), and two former Post Office executives, Francis Matabane and Geoffrey Mabote.
Mampeule cancelled a contract with VDH in response to allegations that tender regulations had been flouted, board decisions ignored and the tender price fraudulently inflated. The deal was initiated under Manyatshe’s tenure in 2003 and was potentially worth more than R2-billion.
In his affidavit, Mampeule said that the Post Office had put out a tender to revamp post office branches in 2003 but later cancelled the process as it was nearing completion.
Manyatshe, Matabane and Mabote put forward VDH, a company that had not participated in the initial tender process to refurbish branches, on an ad hoc basis without going through the normal tender process.
In 2004 Manyatshe signed a contract with VDH on behalf of the Post Office to “regularise” the relationship. The Post Office board approved the contract on condition that VHD made a business proposal for each individual project. This condition was not complied with.
Manyatshe left in 2004 and Matabane and Mabote were charged internally late last year. By the time Mampeule had cancelled the contract, VDH had been paid almost R100-million.
Manyatshe has not been accused of benefiting personally from the contract award. However, days before he signed the Post Office contract with the company, he employed VDH to work on his private Johannesburg home, but subsequently cancelled the contract. Manyatshe, Mabote and Matabane have denied wrongdoing in the contract awarded to VDH.
VDH is suing the Post Office for outstanding payments and the matter is currently under arbitration.