Boardroom brawl breaks out at BBS
Mbongeni Mguni | Tuesday April 6, 2021 22:05
Information sourced by Mmegi this evening suggests that the squabble broke out in recent days over non-executive board members’ decision to extend their terms beyond the three year limits which end on April 26. BBS Limited shareholders, who include the MVA Fund and other government related entities, are due to elect a new board on April 30, with five nominees already in the hat to replace the existing non-executives.
Documents indicate that on April 1, the five non-executive members, led by Siwawa-Ndai, held a meeting where Molefe was told to excuse himself, before resolutions were made to extend the terms of service by a further 90 days after April 30.
“The idea seems to be that during that 90 days, the directors work to block the five new nominees from being considered,” a source close to the latest developments told Mmegi.
The resolutions passed on April 1 indicate that the directors want a Special General Meeting “so that due process may be concluded”. However, a legal opinion issued by Armstrongs and seen by Mmegi indicates that the board has been informed that the resolutions to extend the board’s tenure are not legal under BBS Limited’s constitution and the Companies Act.
According to information on the CIPA registry, the BBS board has eight directors with Molefe being the only executive member. The April 30 meeting was due to see five new nominees face off against five current directors who had put themselves up for re-election.
“The unlawful decisions of the board materialised after board members were displeased that five of its members who are retiring on April 26 will face competition from five other candidates for election to the board at the BBS Limited AGM slated for April 30,” reads a note from BBS Limited.
“The “due process” cited by Board Members is simply to ensure that the five retiring directors avoid competition from other people interested to be appointed to the BBS Limited Board.
“BBS Limited Management views the above actions by the BBS Limited Board egregious. To that end, Management has also taken the necessary steps to report concerned members of the BBS Limited Board to applicable regulatory authorities and professional bodies to which they belong for appropriate action.”
Meanwhile, Molefe and Showa face a tense period, as it is expected that they will both show up for work tomorrow morning (Wednesday) in spite of the dismissal letters from the board. Mmegi is informed that both executives have engaged legal counsel to challenge their dismissal as illegitimate, citing that the board meeting where the decision was taken, was unlawfully convened.