The meeting, which was tightly packed into the eighth floor boardroom of Hosken Consolidated Investments (HCI), left some minority shareholders unhappy over certain corporate governance issues and with lingering questions over the future of its media interests, which include broadcaster e.tv.
The AGM followed two weeks of acrimony and a failed labour court bid by former executive chairperson Marcel Golding to halt disciplinary measures brought by HCI, against him.
The court case saw Golding allege he was being targeted for standing up to political interference at e.tv by HCI executive director Yunus Shaik; while HCI defended its disciplinary actions accusing Golding of dubious share transactions in response. Golding, who was also chief executive of Sabido, an HCI subsidiary, which owns the free to air e.tv and other media interests resigned shortly thereafter.
Amid the furore, Golding’s wife, Bronwyn Keene-Young, formerly the chief operating office at e.tv, resigned on Wednesday, also alleging political interference at the broadcaster. Keene-Young’s resignation followed that of Barbara Hogan’s resignation from HCI’s board.
Hogan, the former minister of public enterprises, also raised her unease over political meddling at the broadcaster and her dismay at the manner in which HCI dealt with its inquiries into the share transaction by Golding.
The company has denied these inferences, and maintained it was Golding’s unauthorised trading in the shares of Ellies, a set top box distributor that sparked the mistrust between Golding and the board.
The Southern African Clothing and Textile Workers’ Union (SACTWU), is the majority shareholder in HCI.
Copelyn defends position
At Thursday’s meeting former chief executive Johnny Copelyn, in response to shareholder queries, defended HCI’s position however saying he made “no apologies for who I am nor what HCI is”.
Copelyn defended the company’s record on media independence, and the actions of Shaik, including those relating to allegations that he tried to influence editorial content at e.tv, to prevent damaging HCI’s gaming interests, and to steer e.tv to profile government infrastructure programmes.
In Golding’s labour court papers, he detailed an sms exchange with Shaik, regarding an episode of e.tv’s Maggs on Media, which was to feature gambling addiction. Shaik warned Golding against negative coverage of Tsogo Sun – a key investment of HCI – as negative media attention “rapidly degenerated into self-righteous crusade with government escalating controls or taxes”.
Copelyn said however that, given HCI’s considerable holding in the gaming sector, Shaik’s actions as a board member, were in no way offensive. “While I’ve got the greatest respect and commitment to [the] freedom of the press … when you get down to a point like that, you are reaching a level of political correctness that is naïve,” said Copelyn.
He similarly defended Shaik’s attempts to get eTV to cover government infrastructure programmes such as the opening of the De Hoop dam – an issue also raised in Golding’s papers. Certain contractual relations had been entered between Sabido and the state, said Copelyn, which were “normal, arms length” interactions, and which government had made with various other media organisations to profile its infrastructure development work.
These were negotiated by Golding and Keene-Young he said. They were not premised on “sunshine journalism” or positive coverage, added Copelyn, as work the station did covering such projects included its independent editorial commentary.
Shaik’s efforts to get e.tv to cover the De Hoop dam opening, were in no way a breach of HCI “We ultimately do not see this as, in any way, a significant breach of any policy [or] practise,” said Copelyn. “We do not try to seek to influence the character of the news.”
Copelyn concluded with a written statement in which he highlighted that Golding had offered to “immediately make good on losses” on the Ellies share trades and the company did not expect to suffer any losses thereby.
The company accepted Golding’s statement, that there was no dishonest intent behind these trades. But he noted: “In our view Marcel created a lot of mistrust between himself and HCI by trading in these shares without our knowledge or consent and this is the heart of our difficulties in relation to the matter.”
On the question of political interference the company had from the “inception of this business been a prime protector of the political independence of this business” and “always will be” he said.
Golding also delivered a statement on his exit saying: “The past 10 days have been challenging. My colleagues at HCI have won and I have lost and I will be leaving. My hope is that the legacy I have tried to build continues under the leadership of the company.”
On the Ellies matter Golding said he did not act dishonestly nor for personal gain and “acted in good faith in what I believed was the best interests of Sabido and its Openview HD platform.”
But shareholder activist Theo Botha said better corporate governance at the group could help to stem such the problems that had been aired in public over the last few weeks. An independent non-executive chairperson was needed within the group said Botha.
He was particularly concerned over Shaik’s role as both an executive director at HCI and his role as an non-executive director at Tsogo Sun, and the allegations that he tried to intervene in how Tsogo Sun be portrayed in e.tv’s covered.
“I wasn’t comfortable with that from a corporate governance perspective and I think he shouldn’t have put himself in that position,” Botha said. Chris Logan of Opportune Investments said the spinning off of HCI’s media assets would be an “elegant solution” to the current trouble. Without pronouncing on whether there was political interference, this would prevent concerns about this and “create a lot of value” he said.
Such an unbundling had been a possibility at one stage and was a matter Hogan raised.
In her resignation letter she noted that SACTWU’s refusal to approve any restructuring proposals that would “have separated the media interests of the company from HCI, thereby enabling SABIDO to separate from HCI with Marcel at the helm of the former, (a restructuring endorsed by the HCI Board) reinforces my unease.”
Copelyn said during the meeting however that although the company had done extensive work exploring this, “given where we are today, that is most unlikely”.
“I would say the chances of HCI spinning off its media assets at this point in time is close to zero,” he said.