PPC avoided a boardroom coup by shareholders after it agreed to offer investors the chance of board representation.
The Public Investment Corporation, the government-employee pension fund that is PPC’s biggest stockholder, and Lazard, the cement producer’s third-biggest owner, will be among those allowed to nominate directors to serve on the board, chairperson Bheki Sibiya said in an interview on Wednesday.
“We’re opening the space between now and the end of the day on Monday for other shareholders who believe they can nominate some candidates who are worthy, to be put through the nominations committee,” Sibiya said by phone. “We sought and achieved common ground.”
Based in Johannesburg, South Africa’s largest cement company was heading for a showdown with shareholders after former chief executive Ketso Gordhan won support to schedule a December 8 vote by investors to appoint a new board that he would lead to maintain company strategy. Gordhan resigned on September 22 after he failed to get backing to fire chief financial officer Tryphosa Ramano.
“I expect that the new board and CEO will find my reasons to exit the CFO very compelling and act on it in the future,” Gordhan said on Wednesday in an emailed response to questions.
Ramano has the full support of PPC’s board, Sibiya said.
Foord Asset Management, Visio Capital Management and Nedbank Group – which had all previously wanted the vote – agreed with Sibiya that the new process will achieve the best outcome for the company and all of its shareholders, PPC said in a statement.
The new board will consist of 12 non-executive directors and won’t include any current or former permanent executive directors who have served within the last decade, PPC said.
“We have been engaging with some of the larger shareholders,” Sibiya said. “Lazard was keen, and we continue to expect that they are keen, to make some nominations.” Management is also aware that the PIC, “either directly or through some of the asset managers”, may also offer candidates.
PPC’s shares have fallen 23% since Gordhan resigned. The stock was trading up 0.3% at R25.16 at 12.28pm in Johannesburg. – Bloomberg