Investors in Pinnacle Holdings took a dim view of news on Tuesday that Takalani Tshivhase, who is an executive director at the JSE-listed technology company, had been arrested and charged for corruption after he allegedly tried to bribe a top police official.

Pinnacle’s share price was down by more than 18% in lunchtime trading. The shares were changing hands at R16,34/share shortly after 12.30pm, down from Monday’s close of R20/share. (Update: The share price closed the day down 25%.)

TechCentral revealed early on Tuesday morning, before the markets opened, that the Hawks had arrested Tshivhase for allegedly offering a R5m bribe to a lieutenant-general of the South Africa Police Service in order to secure a lucrative technology contract. Through Pinnacle, he has denied the allegations.

“From the evidence thus far available to the company, the company is satisfied that there is no reason to doubt the veracity of Mr Tshivhase’s denial of the allegations,” Pinnacle said in a statement issued to shareholders.

“The company will review the matter as further information becomes available and will inform shareholders accordingly.”

Tshivhase has already appeared in the Pretoria specialised commercial crimes court on a charge of corruption.

He was released on R10 000 bail on 5 March, the same day he was arrested.

The case is set to be heard on 24 April.

Tshivhase intends fighting the charges against him.

Hawks lieutenant-general Anwa Dramat said Tshivhase’s arrest “should serve as a reminder to companies doing business with government that corruption is not an option in securing business deals”. — (c) 2014 NewsCentral Media