Government is keen to “entrench” certain of the special rights it enjoys in Telkom under its “class-A share” that expires on 5 March.
Communications minister Roy Padayachie says government “has accepted” that these rights, which it has enjoyed since Telkom listed on the JSE in 2003, will expire on that date.
However, he says government is in talks with Telkom’s board about reinstituting some of the rights in Telkom’s new articles of association.
Until now, government has had the right to appoint the chairman of Telkom and has had the power to veto the appointment of the CEO.
“There are certain specific rights we are keen to try to entrench,” he says. “I don’t want to make an announcement now [about this]because it’s still the subject of discussions between government and Telkom.”
The minister says government is also talking to the JSE to ensure whatever rights it seeks do not conflict with the bourse’s rules. “We have been in consultation with the JSE and the board of Telkom about this.”
The new rules of association don’t need to be in place when government’s special rights fall away, Padayachie says. “There is no crisis as far as legal statutes are concerned. In time, the Telkom board will deal with the issue of amending [the articles].”
This may only happen after the introduction of the new Companies Act on 1 April, he says. “Telkom would like to see what that brings into the discussion.” — Duncan McLeod, TechCentral