Telkom Towers — Telkom's head office in Pretoria

Telkom looks set for a big management shake-up in the next few months as government moves to appoint a permanent CEO and a chairman to lead the telecommunications group.

The two crucial roles are likely to be filled before government’s special rights in the group expire on 5 March. Those rights give it the ability to appoint the chairman and give it a say in who is appointed as CEO.

Talk in the management corridors at Telkom is that government may replace chairman Jeff Molobela, who was appointed to the position by former communications minister Siphiwe Nyanda.

Molobela’s contract expired at the end of October last year, but has been extended twice by Nyanda’s successor, Roy Padayachie. Speculation is mounting as to whether Molobela will be reappointed, or whether he will be replaced.

Molobela has proved a divisive figure at Telkom. Both former CEO Reuben September and former chief financial officer Peter Nelson quit the group after clashing with him.

Already, well-known businessman Lazarus Zim has been mentioned as a potential candidate for the chairmanship. Zim did not return a call seeking clarity on the speculation.

All department of communications spokesman Tiyani Rikhotso will say is that the “process of appointing a chairman to Telkom’s board is still ongoing” and that he cannot comment any further.

If he is appointed to the position, Zim will bring a strong business background to Telkom’s board. A former CEO of Anglo American SA, Zim has led MultiChoice SA and sister company M-Net, as well as MTN International. He is founder of Afripalm Resources, which he now chairs.

Zim is also regarded as politically well connected, which would stand him in good stead as Telkom’s chairman.

Under special rights that expire on 5 March, government is entitled to appoint the chairman of Telkom. This is its last chance to do so before the rights expire.

Whoever is appointed as chairman will play a pivotal role in finding a permanent CEO to lead the telecoms group. Jeffrey Hedberg, an American national and former CEO of Cell C, is running the organisation in an acting capacity for now.

Government’s special rights over Telkom also give it a say in who is appointed as CEO, and so it’s highly likely it will also move to fill this position before these rights expire.

Market commentators worry that because Hedberg is not politically connected he won’t be installed in the top job on a permanent basis, even though he is highly regarded in the analyst community. — Duncan McLeod, TechCentral