PPC shortlists candidates to reshuffle its Board

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Former PPC CEO, Ketso Gordhan resigned as head of South Africa’s biggest cement company in September after fellow directors blocked his attempt to fire Chief Financial Officer Tryphosa Ramano. Former PPC CEO, Ketso Gordhan resigned as head of South Africa’s biggest cement company in September after fellow directors blocked his attempt to fire Chief Financial Officer Tryphosa Ramano.

There has been considerable activity at PPC Ltd, with the company announcing a shortlist of candidates to succeed Ketso Gordhan as CEO and plans to make an appointment should shareholders vote to retain the board next month.

The list of candidates put forward by activist shareholders to replace PPC’s board contains big names in cement, mining and deal-making — turning up the heat in what is a white-hot standoff between the board, minority shareholders and former CE Ketso Gordhan.

The list contains past and present PPC executives, including its finance director from 2000-03, Peter Nelson, who has since held chief financial officer posts at Netcare and Telkom, Chairman Bheki Sibiya said.

It also includes the highly regarded MD of PPC’s international business, Pepe Meijer, as well as PPC’s most recent board appointment, experienced mining executive Darryll Castle.

Gordhan resigned as head of South Africa’s biggest cement company in September after fellow directors blocked his attempt to fire Chief Financial Officer Tryphosa Ramano. He has since been trying to engineer a return and investors will vote on whether to appoint a new set of directors, including Gordhan, at a meeting in Johannesburg on Dec. 8.

“We have 85 candidates, of whom six are the cream of the crop,” Sibiya said by phone today. “We are looking at a person who is going to buy into the board’s strategy. We are not looking at anybody who is going to change the strategy.”

The remaining six are former AngloGold Ashanti CEO Bobby Godsell, Keshan Pillay, Claudia Manning, Gesina Coetzer, Nompumelelo Siswana, and Itumeleng Dlamini.

A PPC source who asked not to be named suggested the list of candidates had less cement industry experience than the incumbent board. This is something the sitting board has been criticised for by shareholders and past executives who want it replaced.

Should shareholders vote at a special meeting next month to overhaul the PPC board, the new board would have the task of appointing its choice of CEO.

However, activist shareholders who demanded the vote, including Foord Asset Management, Visio Capital Management and Nedbank Private Wealth, were dealt a blow on Thursday when a major PPC shareholder, the Public Investment Corporation (PIC) confirmed that it would vote against the resolution to replace the board. The PIC holds 12% of PPC’s shares.

The PPC board on Thursday continued its moves to reassure investors that it has the capability to run the business in Mr Gordhan’s absence. PPC executive chairman Bheki Sibiya said on Thursday a foreign financial institution "has made a commitment to fund PPC’s Africa strategy for the initial tune of $225m.... This should be concluded fairly soon."

Mr Gordhan has said in the past week that he had a major funding deal lined up with an international funder, which was at risk of being scuppered with the current board in place.

Mr Sibiya said the board was also seeking legal advice about Mr Gordhan’s public campaign for reinstatement, to determine whether he could be declared a "delinquent director".

A PPC executive who recently left the company after more than a decade, and who asked not to be named, said on Thursday he "can understand Ketso’s frustrations" with the board and with "certain members of the finance team".

PPC is expanding in African countries where demand for cement outstrips supply and plans to have 40 percent of sales outside its home market by 2017. Gordhan said last week the company may struggle to continue the growth plan because a deal to obtain $200 million of funding is close to collapse, a situation he says he could rectify. The company said Nov. 7 it doesn’t want Gordhan back as CEO.

The Cement maker has operations in the Democratic Republic of Congo, Zimbabwe and Ethiopia.

PPC shares gained 0.5% to R27.81 at close on the JSE on Thursday. They have declined 14% since Sept. 19, the last trading day before Gordhan’s resignation was announced.


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