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CEO resigns

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Regular Contributor
Interesting...I see the CEO is out. I wonder what the "package" will be and how they will hide this!
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Valued Contributor
they can't hide it, will be in next annual report
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BullsnBears
Contributor
I've just sold out all my MTN. My gut tells me that something is rotten over there.
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Super Contributor
Well, what did I say, I said i would fire him if i was the Chairman or majority investor... i thin this happened...
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Super Contributor
I am a bit concerned where the funds will come from for this fine. if its not reduced it makes a huge amount and the cashflow cannot support this, I think they don't have the funds available and as Skaaptjop said, they will need a rights offer. this will dilute the shares and earnings/dividends, but one should calculate the effect dilution could result in, the PE and DY of this and if the drop in price results in acceptable Yields for investors, then it makes sense to buy or hold for long term... the new CEO has a huge task to regain the investor confidence now (as you jus said you think there is something rotten), but if they don't have more of these surprises and he/she can create a better ethical culture, it could be an ok investment for long term... whats your thoughts?
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Valued Contributor
I don't think they'll do a rights issue, they'll likely borrow the money .. remembering it is due on Monday 16th
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Super Contributor
The fine has been reduced.. the CEO resigning is a casualty.. the board needs someone to blame.
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Super Contributor
and rightfully so... that guy should be implementing culture and policies etc thats ethical, law abiding and not result in this type of thing. look at those wall street CEOs that ran their companies into the ground, it was also because they were not looking at the bigger picture and only their pockets...
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Super Contributor
ok, but then they will have to work on some ideas to reduce their substantial debt burden over time? i wonder who will give them a loan? SA investment bank of some sort, or international? JPMorgan or Goldman, Barclays? or whats going on with the Government negotiations?
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BullsnBears
Contributor
They've got a billion dollars in Iran which should help them when the sanctions are lifted. The silence since the story broke was atrocious. And what concerns me even more is that they are almost certainly flouting regulations in other markets as well, South Africa included. What happens when authorities in other countries start poking around?
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Super Contributor
thats a huge risk investors will be taking now... they need a CEO that will fix such things asap! for the i ran money, isn't this indicated on the financial statements etc? if it is, they might have trouble even with that... this is a substantial amount of money!
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BullsnBears
Contributor
It's money from a loan and dividends from their Iranian unit. Not sure if it's already in the finances since they haven't actually received any of it yet. Simon, can you shed some light on this?
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Super Contributor
Well, the main issue was poor management, the manager has been fired. So, next is price and its a buy, not a sell.
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Valued Contributor
hali what's the source for ==>> The fine has been reduced
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Valued Contributor
the Iran money is still blocked, likely till Q2 next year and then the Iran gov may not be keen to see it go so they may try block it .. it about ZAR30billion I thinks
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Super Contributor
i see all over that MTN gave in and agreed to pay that value...
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Valued Contributor
but is it management or a culture ?? I would say latter
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Super Contributor
I agree its probably the culture, something like will not only be one guy... its the way of thinking, and this needs to change, it will take effort and time, but it is possible if the right leader is put into place!
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Regular Contributor
Is there not a case for criminal negligence charges ?
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Super Contributor
Doing the math for derigstartion: at about $86 per user , that would be about $430 billion, which has to be removed from revenue. So either way, it was going to be a major "loss". Yes, this is what should have been communicated.
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