Net1 UEPS Technologies, the group whose subsidiary, Cash Paymaster Services (CPS), controversially manages South Africa’s welfare payments system, is terminating the services of its former CEO, Serge Belamant, it said on Monday.
In June, Net1, which is listed in Johannesburg and New York, said it would pay Belamant US$50 000/month (about R660 000) to consult to the company after it accepted his early retirement.
Bloomberg reported at the time that Net1’s second biggest shareholder, asset manager Allan Gray, was outraged at his settlement agreement. The International Finance Corp, its largest shareholder, also voiced disapproval.
Net1 also agreed to pay its former CEO $8m as well as a 14% premium on more than a million shares that he owned in return for his early retirement.
“Allan Gray notes with outrage the financial settlement claimed by Serge Belamant upon his retirement as CEO of Net1,” Allan Gray said in a statement at the time.
“We are very surprised that Belamant was able to negotiate such an extravagant deal after such broad public censure, and believe that it is unjustified given current circumstances.”
On Monday, in a note to shareholders, Net1 said it has given Belamant 90 days’ written notice that it intends terminating his two-year consulting agreement with the company.
“The company will not be making any termination payments to Mr Belamant beyond the 90-day notice period,” it said.
‘Limited value’
“We have managed a smooth transition and thus believe there is limited value to continuing with such agreement for a lengthy period of time,” said chairman Christopher Seabrooke in the statement.
“We discussed our decision with Mr Belamant, who concurred with our conclusion. Our parting is cordial and we wish him success in his future endeavours after the remaining period of the consulting agreement with us,” Seabrooke added.
Belamant had been due to retire in 2018.
In 2012, Net1’s CPS won the contract to manage the social welfare payments system in South Africa. In 2014, the constitutional court found that the contract was unlawful. — (c) 2017 NewsCentral Media