Pinnacle Holdings’ share price plunged by 17,4% on Monday after it warned shareholders that it has been drawn into a case involving corruption charges against a top South African National Defence Force (SANDF) official.
“Pinnacle shareholders are advised that Pinnacle Micro, a major subsidiary of Pinnacle, previously trading as Pinnacle Africa, has been mentioned in the charging and court appearance of brigadier-general Leon Eggers,” the company said in a statement issued via the JSE’s stock exchange news service.
It said Eggers is accused of favouring Pinnacle Africa and another supplier in the awarding of business, by using his official position to obtain from the companies private gifts or benefits for himself during the performance of his duties.
“Pinnacle Africa dealt with Eggers and the [SANDF] over a number of years and in the same manner as any other customer,” Pinnacle Holdings said in the statement to shareholders.
“Pinnacle Africa networks with its customers and invites customers to many events, including sporting events, at Pinnacle Africa’s expense. Pinnacle Africa has never requested nor expected nor received any special treatment or favours from any of its customers, in return for any such entertainment provided by it, and it would never do so.”
The shares had fallen to as low as R14,30 earlier in Monday’s session — down by 22% — but recovered some ground to close at R15,20.
It’s the second time in as many years that Pinnacle has been rocked by allegations of bribery and corruption.
In March 2014, former Pinnacle director Takalani Tshivhase was arrested after being accused of trying to bribe a top police official with R5m to secure a lucrative IT contract.
News of his arrest sent Pinnacle’s share price into a nosedive that it has only recently begun to recover from.
The charges against Tshivhase were later dropped by the national directorate of public prosecutions.
“The company is very pleased that our unwavering belief in Mr Tshivhase’s innocence, and our ongoing support of him in his quest to clear his name, has been vindicated,” Pinnacle said in a statement at the time. — © 2016 NewsCentral Media
