PPC’s shares jump to welcome new chief executive

File photo: Supplied

File photo: Supplied

Published Dec 18, 2014

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Roy Cokayne

 PPC’S shares briefly responded positively yesterday to the appointment of Darryll Castle as the new chief executive of the listed cement and lime producer before sliding back to close at R24.32, its lowest level on the day.

The share close was 2.72 percent lower than PPC’s R25 closing price on Monday.

The appointment of Castle, a former chief executive of Trafigura Mining Group and Toronto Stock Exchange-listed Anvil Mining and more recently a chief operations officer at Metorex Group, will be effective from January 12.

PPC said Castle had, through his extensive career, accumulated a broad range of experience and skills spanning the fields of corporate management, fund management, financial analysis, mining and engineering.

The company added that Castle had extensive international experience from having run mining companies operating on all continents and also had first-hand operations and projects experience on the African continent from having worked in the Democratic Republic of Congo, Zambia, Angola and Tanzania.

Bheki Sibiya, the executive chairman of PPC, said Castle’s extensive experience and knowledge, as well as deep relationships on the continent and in other emerging markets, would add further impetus to PPC’s growth strategy.

“We welcome him to the board in an executive capacity and look forward to working with him in delivering on the company’s mandate from shareholders,” he said.

 

Board squabble

Castle’s appointment follows the resignation of former PPC chief executive Ketso Gordhan at the end of September when PPC’s board prevented him from dismissing the company’s chief financial officer, Tryphosa Ramano.

However, Gordhan shortly thereafter attempted to get the board to allow him to retract his resignation and reinstate him, which was refused.

Gordhan then embarked on a campaign to get himself reinstated as chief executive, culminating in Foord, Visio and Nedbank Private Wealth submitting a request to PPC’s board to call a general meeting about the proposed removal of the current board.

PPC reached an agreement earlier this month with the three disgruntled shareholders to reconstitute and expand the company’s board, resulting in the cancellation of the special general meeting.

PPC said at the time it was deemed in the best interest of the company to select a new chief executive at the earliest possible date, and the current board would continue the selection process, which could be completed prior to the annual general meeting on January 26.

Attempts to obtain comment from Gordhan on the appointment were unsuccessful.

Sibonginkosi Nyanga, an analyst at Imara SP Reid, said yesterday that he believed Castle was a good appointment because of his qualifications and experience internationally and in Africa.

 

Market

But Nyanga said the slump in recent months in PPC’s share price was only partly caused by “the boardroom squabble” involving Gordhan.

He said PPC’s share price had also declined because of increased competition in the short to medium term in the South African market from Sephaku Cement and Mamba Cement.

“The market also saw PPC’s African strategy as Ketso’s (Gordhan) strategy and would want to see how Castle implements this strategy,” he said.

PPC’s African strategy has a target of generating 40 percent of the company’s total revenue from outside of South Africa by 2017 from 26 percent currently.

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