JOHANNESBURG - Eskom yesterday surprised the market, announcing current Nampak chief executive Andre de Ruyter as the power utility’s new boss, effective next year.
Public Enterprises Minister Pravin Gordhan announced de Ruyter as the new group chief executive to steer Eskom’s sinking ship four months after Phakamani Hadebe threw in the towel one year into the job.
Gordhan said de Ruyter would start his duties on January 15, 2020.
WATCH:
Video by: Chelsea Lotz, Business Report TV
De Ruyter beat former LNG Canada chief Andy Calitz and Jacob Maroga, who headed Eskom between 2007 and 2009, for the position.
“I am confident that he (de Ruyter) will lead a committed and capable management team that will work
with him and the board to take
Eskom forward,” Gordhan said in a statement.
De Ruyter comes to Eskom at a crucial time: the power utility is trapped in nearly R500billion of debt and faces a complicated restructuring process that will see it split into three separate units of generation, distribution and transmission.
Gordhan said the department opted for de Ruyter based on his experience in driving multinational operations for more than 20 years.
De Ruyter holds various qualifications, including an LLB and MBA.
Gordhan said de Ruyter spent more than 20 years with petrochemicals group Sasol and gained significant global exposure in the energy and chemicals industries.
His portfolio included overseeing work in the US, Nigeria, Angola, Mozambique, Germany and China.
Gordhan said de Ruyter agreed to take the Eskom job, even though his salary would be much less than what he is earning at Nampak.
De Ruyter has been chief executive of Nampak for the past five years.
Under his reign, Nampak’s share price has fluctuated and tumbled more than 60percent from about R40 to R7.35 when the JSE closed yesterday.
De Ruyter undertook a restructuring and reorganisation process that resulted in the sale of low-margin businesses, a capital expansion programme, investments in energy efficiency, an improved focus on operational excellence, cost reductions, and improvements in procurement processes.
Nampak also sold Nampak Glass to majority-black-owned company Isanti Glass1 for R1.5bn early this year and its non-core cartons business in Nigeria for 26million (R422.22m).
In the six months to the end of March, the group reported a 9percent decline in profits to R795m, on the devaluation of the kwanza in Angola and pedestrian economic growth in other African countries - most notably South Africa - and depressed consumer demand and volume growth.
The significant exception has been Nigeria, where beverage can volumes have grown significantly, continuing a trend that has prevailed after the floating of the Nigerian naira.
In June, shareholder activist Theo Botha questioned de Ruyter’s R8.4m short-term bonus when the company was not doing well.
Botha said Nampak had shown no dividends in the past three years and had lost R600m on discontinued operations.
Gordhan, however, said that de Ruyter beat 142 potential candidates, including eight Eskom employees, for the post.
He said he was grateful to the board of Nampak for agreeing to release de Ruyter, adding that this showed a partnership approach between all stakeholders to make any and every contribution towards a successful turnaround of Eskom.
“Solving our current problems as a nation indeed does require a partnership approach, and I am more than encouraged that we are all working as partners, with everyone doing their part to help.”