If Solomon did wrong, he's gone

Allan Seccombe | Wed, 03 Feb 2010 16:57
[miningmx.com] -- WESIZWE CEO Mike Solomon will be subject to a disciplinary hearing and possibly removed from his position if an internal audit finds he violated corporate governance rules, said new chairman Dawn Mokhobo.

The internal audit is one of four key issues that she and the new board at Wesizwe want to address before a board meeting on 22 February to get the company back on track and busy with its platinum project after a bruising boardroom battle.

“If the audit indicates that [that Solomon should go] we’ll act accordingly. The cleaning up process is, for me, absolutely critical,” Mokhobo told Miningmx.

The board will respond to recommendations made by law firm Deneys Reitz without favour, she said.

Allegations made by directors during the boardroom battle, and who are now out of the company, against Solomon and former chairman Rob Rainey include that there were unauthorised conversions of share options to cash bonuses, abuses of the company credit card to the tune of R2.8m, with no supporting vouchers in some cases, to pay for parking his aircraft at Cape Town International Airport, paying for oysters flown in for his wife and buying groceries.

“These allegations will be dealt with under my supervision and we have to sort them out. We have an oversight committee chaired by me... and it will ensure all the allegations are investigated. We’ve broadened Deneys Reitz’s mandate and they’re getting on with it,” Mokhobo said.

The boardroom tussle saw Solomon and Rainey thrown off the board and a small group of directors engineering a non-return to the board of a number of other directors, giving the dissident group control of the company. However, Solomon, Rainey and the other board members were returned to the board at an extraordinary shareholder meeting in December, along with a couple of new independent directors.

Among the four issues, is the board deciding on the strategies it will follow to realise value from its undeveloped ore body on the Western Limb of the Bushveld Igneous Complex.

Board minutes have shown Wesizwe has spoken to South Africa's Impala Platinum and China's Jinchuan about being strategic partners or buying the deposit.

The critical pathline is securing the approval for the transfer of mineral rights from Anglo Platinum and its inclusion on Wesizwe's shareholder register as an owner of 27% of the company.

The appointment of a financial director is another critical requirement. The former financial director, who later became acting CEO, Nyasha Tengawarima, was removed from the board in December.

A short list of possible financial directors has been drawn up and an appointment should be made within coming weeks to ensure the company complies with JSE regulations, said Mokhobo. The appointment will be cleared with Wesizwe’s auditors to ensure the person is suitably qualified.

The fourth and most difficult matter to deal with is ensuring there is a properly mandated and formally chosen representative of the Bakubung-ba-Ratheo representative on the board. One of the community’s two directors was removed from the board in December and the remaining member Ezekial Monnakgotla is not favoured by a section of the community.

Wesizwe has enlisted the help of the Department of Mineral Resources and the North West provincial government to assist the community in deciding their representatives on Wesizwe’s board.

“We’d like to have all these issues discussed and debated at the board meeting,” Mokhobo said, adding if the audit report into the allegations against Solomon was not completed she would call a special board meeting when it was completed to discuss what action, if any, needed to be taken.