Johannesburg - South African fixed-line operator Telkom said on Friday the suspension of its chief financial officer (CFO) was related to allegations of personal misconduct and not insider trading.
Telkom on Thursday suspended Jacques Schindehutte due to an investigation into allegations against him.
“There is no connection whatsoever between the suspension of Mr. Schindehutte and the insider trading enquiry instituted by the JSE in relation to Mr. Schindehtte's trade in Telkom shares,” the company said in a statement.
“The suspension relates to allegations of personal misconduct leveled against Mr. Schindehutte and which came to the Board's attention through a whistleblower.”
Schindehutte bought nearly 6 million rand ($615,000) worth of shares in Telkom on September 30 at 24.45 rand each, a regulatory filing showed.
On October 8, the company said it was likely to report a 20 percent increase in first-half profit, sending its shares to a 20-month high of 27.99 rand.
Solly Keetse, the head of the market abuse department at South Africa's Financial Services Board, declined to say whether the market watchdog was investigating Schindehutte's trade.
Shaun Davies, the director of market regulation at the Johannesburg Stock Exchange (JSE), also declined to comment.
Telkom said it had hired an external law firm which has investigated the allegations against Schindehutte.
“Mr. Schindehutte was served with a letter of suspension in which Telkom clearly sets out the allegations leveled against him and to which he is required to respond,” it said.
The company has appointed Deon Fredericks to serve as acting CFO pending the outcome of a Schindehutte's disciplinary process.
Shares of Telkom were little changed at 26.97 rand at 13:15 SA time, Johannesburg's All-Share index was also flat. - Reuters