Johannesburg – Dual-listed Net1 UEPS Technologies, which
has come under scrutiny over its welfare deal, is splitting its Chairman and
CEO roles.
In a statement issued on Friday, the company – listed on
the Nasdaq and the JSE – said it was splitting these roles “in recognition of
the growing practice of US public companies, as well as the customary practice
of South African public companies, to have the Chairman be an independent
director”.
It says its board “has come to believe that separating
the roles of Chairman and Chief Executive Officer is the appropriate corporate
governance model for the company at this time, especially given its secondary
listing on the JSE and its significant South African institutional shareholder
base”.
Towards the end of March, Bloomberg reported that Allan
Gray, the second-biggest shareholder in Net1, said it will work with the
company’s board after it highlighted concerns about its communication with its
investors about deductions it makes from the welfare checks of clients in South
Africa.
Net1 says it has appointed Christopher Seabrooke as
Chairman, while Serge Belamant has resigned as chairman but will remain a
director and CEO.
Seabrooke has been a director of Net1 since 2005, and
chairs several of its committees. He holds degrees in Economics and Accounting
from the University of Kwa-Zulu Natal and an MBA degree from the University of
the Witwatersrand.
Net1 adds Seabrooke is a “highly experienced director,
having been chairman or a director of over 25 stock exchange quoted companies
over the past 30 years” and is currently CEO of Sabvest.
Read also: Pressure on Net1 to comply with lending practices
Net1 says its board is also actively seeking to appoint
additional independent directors, at least one of which will be a person
designated by the International Finance Corporation.
On March 17, South Africa’s Constitutional Court ordered
the South African Social Security Agency to extend Net1’s contract, which it
had previously ruled invalid, to distribute monthly grants to more than 17
million people for a year to avoid an interruption to the disbursement of more
than R150 billion in payments a year.
Net1, which won the deal in 2012, has been accused by
human rights groups of making illegal deductions from the checks for goods and
services its subsidiaries sell. It has denied the allegations.
“Allan Gray has written two letters to Net1’s board,”
Andrew Lapping, the fund manager’s chief investment officer, said in an
interview with Bloomberg in March. “Allan Gray wants to drive change from
inside rather than a hostile way from outside.”
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