Old Mutual's reputation on the line as Moyo, Manuel battle rages on
Old Mutual, the 174 year-old JSE-listed insurance company, yesterday moved to file court papers to appeal the court ruling that he be reinstated with immediate effect.
Judge Brian Mashile on Tuesday ruled that “both the suspension and subsequent dismissal were unlawful”.
Old Mutual said it had filed for leave to appeal the court order to have Moyo reinstated, saying Moyo would not be returning to the office until the appeal process had been completed.
Old Mutual spokesperson Tabby Tsengiwe said the company was waiting for the judge to communicate a date for when he or she would hear the application for leave to appeal.
“Due to the difference of opinion about the interpretation of the application to appeal. Either party is at liberty to approach the court for relief,” said Tsengiwe.
Tsengiwe said Old Mutual had made the right decision to sack Moyo when the conflict of interest over his NMT Group became unmanageable.
“Old Mutual re-iterates that its board can and should hold the chief executive to a high standard. This requirement is both implicit and explicit in the employment contract.”
Moyo earlier yesterday reported for duty in line with Tuesday’s court order that he be temporarily reinstated with immediate effect.
Moyo spent most of the day on the foyer of the company’s Sandton office in Johannesburg after the insurer informed him that he was not permitted to resume his duties, pending the outcome of the appeal proceedings.
Eric Mabuza, Moyo’s legal council, said that Old Mutual was in contempt of court.
“He (Moyo) will assert his rights. The court found that he should be reinstated,” said Mabuza.
Moyo had approached the court on an urgent basis to get his job back, saying he was unceremoniously given the boot after raising impropriety against chairperson Trevor Manuel.
He raised a triple conflict of interest against Manuel who was finance minister between 1996 and 2009 led Old Mutual’s transformation to being a privately-owned JSE company.
Analysts said yesterday that the uncertainty which weighed on the stock would continue until Moyo’s axing was resolved.
Kokkie Kooyman, a director and portfolio manager at Denker Global Financial Fund Long, said the continued squabble with Moyo would hurt its reputation.
“I cannot see Old Mutual bouncing back until the impasse is resolved.”
Kooyman said it was likely that the board members would be axed should Old Mutual lose its appeal.
“Manuel and other board members will likely resign if the court dismisses the appeal. Unfortunately, the attention will shift from managing the business to the fight with Moyo,” said Kooyman.
Ron Klipin, an investment analyst at Cratos Capital, was more positive.
He said Old Mutual’s business model remained strong and robust and the legal squabble between Moyo and Old Mutual did not distract from these strong business fundamentals.
“This is an internal matter between Moyo and Old Mutual and all those things can be resolved. This is a highly cash generative business. It is strong on funeral policies for lower LSM groups,” said Klipin.
Old Mutual’s share price remained unchanged on Wednesday.