Telkom's CEO quits

By Paul Vecchiatto for Telkom
Johannesburg, 05 Apr 2007

Telkom CEO Papi Molotsane has resigned with immediate effect, the telecommunications utility said today in a terse Stock Exchange News Service statement.

Molotsane who assumed Telkom's helm 18 months ago after the departure of Sizwe Nxasana, had been heavily criticised lately, particularly by the Department of Communications director general Lyndall Shope-Mafole.

This is also the third high-profile resignation Telkom has had in the past six weeks. Early last month former chief technical officer Thami Msimango and chief sales and marketing officer Wally Beelders resigned.

No official reason has been given for Molotsane's departure. However, Telkom signed the Eassy (East African Submarine Cable System) supply contract, which includes the cellular network operators and other international telecommunications companies, with equipment supplier Alcatel Lucent on 9 March.

This contract was severely criticised by the DOC's Shope-Mafole before the Parliamentary Portfolio Committee on Communications, saying: "It was outside the policy framework that had been set for Eassy."

Shope-Mafole also said that government would exercise its board power (it controls six out of the 10 seats) to ensure that Telkom would not get the required funding to play its part in Eassy.

In terms of the Eassy policy, access would be on a non-discriminatory basis, while Molotsane has insisted that Telkom's participation would be on commercial principles.

Dene Smuts MP, Democratic Alliance spokesperson for communications says: "If this [Molotsane's resignation] has to do with the undersea [Eassy] cable, then the DOC is being unrealistic in basing the success of it on diplomacy and politics. Companies have to have a realistic reason to invest.

"Where was government when it could have used its 38% stake in Telkom to make it work in the public interest in the past? Telkom has behaved exactly like any other listed company should and the delay in competition has not been its fault - no matter how frustrating the situation has been."

According to Telkom's announcement Molotsane will be replaced by chief operating officer Ruben September on a temporary basis until a new permanent CEO is found.

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