[times LIVE] Government will continue to be consulted on key issues regarding Telkom because it remains a significant shareholder in the listed telecommunication company.
Telkom chair Lazarus Zim said this week, following the announcement that Nombulelo "Pinky" Moholi had been appointed as CEO, that the company was run by its management and board, but that government was a "strong ally'' in the process.
Government is the biggest shareholder in Telkom, with a direct interest of 39.8%. However, government's special class-A or "golden" share, which gave it the right to appoint five of the company's 12 directors, including its chairman, expired on March 5.
Zim was appointed shortly before the expiration, leading to speculation on his appointment being an attempt by government to retain some influence over the board.
When asked about the speculation, Zim questioned why he was suddenly seen as a representative of government.
"I have been in the telecommunication sector before, I spent most of my career in the ICT sector and I am not new to Telkom," he said.
Regarding the timing of his appointment, he said government had to appoint a new chair at the time as the term of the previous chair (Jeff Molobela) has expired.
"We now have a CEO who was appointed after the golden shares expired."
Zim is reported to have close business ties with the Gupta family and Duduzane Zuma, President Jacob Zuma's son.
He said rumours about these relationships helping him to clinch deals did not bother him.
"Why should it bother me?" he asked.
"I am here to do a job at Telkom and my track record speaks for itself."
Moholi's appointment comes after acting CEO Jeffrey Hedberg said in January he would not renew his contract when it expired at the end of this month.
He will stay on in an advisory capacity until the end of June. When Moholi takes over on April 1 she will be the company's fifth CEO since its listing in 2003.
Hedberg's decision not to stay on at Telkom was seen as a blow for the troubled company, but Moholi's appointment was widely welcomed.
As a telecommunications and Telkom veteran she was seen as a the front-runner for the job for the past two weeks.
Zim said this week the process to appoint a chief financial officer was on the go and that a "good shortlist" had been compiled. "We had to wait for the CEO to come into place as we have to make the decision with her," he said.
"We cannot appoint a CFO without a CEO. The normal business rules apply. I do not know why you would expect Telkom to behave differently."
Moholi said there was no denying the challenges at Telkom, especially with regard to leadership. The challenges were the consequences of some bad investments by the company, she said.
"But there is also a lot of value in the company, the biggest of which is its world-class network," she said.
"The economy of this country runs on Telkom networks. Therefore if Telkom fails, the country fails."
On retrenchment plans - Telkom is said to be up to 20% overstaffed - Moholi said Telkom had offered voluntary separation packages. She said as there were areas in the company with skills shortages, a "responsible citizen would have to look at retraining people and move them into the areas of the future".
State a 'strong ally' to Telkom - Zim