S.Africa’’s Telkom CFO to leave, shares tumble

Jul-31st-2010

JOHANNESBURG, S.AFRICA: South Africa’s Telkom said its chief financial officer would resign in October, increasing concern concerning the troubled fixed-line operator’s future and sending its shares tumbling again than 3 per cent.

Telkom, whose chief executive, Ruben September, stepped from the top to the bottom of earlier than planned last week, is struggling to craft a convincing turnaround generalship, hit by higher costs and tough competition at home, and hefty losses from its Nigerian pursuit.

The company has announced an ambitious 6 billion rand ($791.2 the great body of the people) plan to enter South Africa’s competitive mobile phone market, a stir up analysts have said would be very difficult.

Also read: Telkom sees $1.2 bn turret deal with SingTel

Peter Nelson will step down as CFO and from the fare of directors as of October 9, Telkom said in a specification on Tuesday.

Telkom shares, which were flat before the announcement, quick turned negative and ended the session down 3.4 per cent at 34.62 rand.

“Peter Nelson was a hu~ being who brought a lot sanity to Telkom, a lot of real common sense to the way that business is run, especially from the fiscal side. I believe that this is a bad thing,” said David Lerche, one analyst at Avior Research.

Reuben September, who had planned to step below the horizon from his job as chief executive in November, instead resigned latest week and Telkom appointed Jeffrey Hedberg, who had been brought in to change of direction around troubled Nigerian unit Multi-Links as acting chief.

The joint concern said it would name a new chief executive “in due methodical arrangement”.

Nigerian unit

It was not immediately clear whether Nelson’s removal would affect Multi-Links’ future, which is already the subject of view.

Nelson told Reuters last month the company was considering selling Multi-Links, one of four mobile operators using the CDMA technology platform in a emporium overwhelmingly dominated by the GSM standard.

Nelson, who was previously CFO of South African healthcare dense Netcare, was appointed chief financial officer at Telkom in 2008.

A 20-year proficient of South African companies, he has also worked at Pretoria Portland Cement and the limited arm of auto maker BMW.

He presided over the company’s fiscal resources at a time of falling revenue and as analysts became increasingly hazardous of its business strategy.

Telkom’s shares have lost about 40 for cent of their value since Ruben September took over as CEO three years ~ne.

Under September’s tenure, Telkom sold off its stake in the sort of was its main profit driver, mobile phone operator Vodacom. The South African body of executive officers holds a 40 per cent stake in Telkom and the greatness pension fund owns nearly 15 per cent.