Allan Gray mulls shareholder meeting to recall Net1 board over Sassa
Allan Gray COO Rob Dower said they had contacted Net1 with suggestions to resolve the issue but were awaiting an official response.
CAPE TOWN - Investment firm Allan Gray says it will consider calling a shareholder meeting to remove the board of Net1 should the South Africa Social Security Agency (Sassa) debacle continue.
Speaking to the Kienno Kammies Show, COO Rob Dower said they had contacted Net1 with suggestions to resolve the issue but were awaiting an official response.
An article in the Business Day claims Net1 CEO Serge Belamant could lose his job if the board is recalled.
Dower added that Allan Gray was surprised by media reports that shareholders of Net1 demanded a profit from an extension of Cash Paymaster Services contract with Sassa to handle social grant payouts.
“I saw in the press yesterday that shareholders demanded profit from what looks like a healthy profit from the extension of this deal. This surprised us a lot. I don’t know if the other 84% of shareholders asked to make any profit, but we certainly don’t think it will be good for the company to be seen benefiting from this.”
LISTEN: Allan Gray considers future of investment in Net1
Sassa and the Department of Social Development Bathabile Dlamini have come under fire after failing to find a new service provider as the contract with the current service provider CPS lapses at the end of March.
In 2014, the Court ruled that the contract with CPS was invalid and unconstitutional and could not be renewed
Minister Dlamini has been criticised over her handling of the Sassa matter with members of Parliament, among others, calling for action against her and other senior officials.
But during his first question and answer session for the year, President Jacob Zuma dodged a call for a commission of inquiry into the social grants debacle and distanced himself from allegations that his lawyer was involved in talks about the payments contract.
Zuma also deflected questions about whether he planned to take action against Dlamini and said it was “a funny democracy” to punish someone based on suspicion.
WATCH: #Sassa: Zuma slams DA’s ‘funny democracy’
(Edited by Shimoney Regter)