Press saga rages on
A week after we reported a sense of agitation at Press Corporation Limited (PCL) over what are seen to be attempts by the DPP administration to get a grip on the conglomerate, it has also emerged that Press Trust made another move.
The Trust has sought a legal opinion on its powers as regards the PCL board and its Group Chief Executive Officer (GCEO).
The move made in February 2016, after the announcement that the current GCEO Professor Mathews Chikaonda would be retiring at the end of this year, is being treated among some rank and file of the corporation as rendering credence to fears that the Democratic Progressive Party (DPP) administration is scheming to swoop on the corporation for its own purposes
But Press Trust claims that there is nothing sinister in its seeking of the legal opinion as it was only intended to guide the Trustees.
Press Trust, one of the shareholders in PCL, sought a legal opinion regarding the “tenure of trustees; retirement of PCL directors and tenure of GCEO [Group Chief Executive Officer]”.
Press Trust sought this opinion from Chisanga & Tomoka legal practitioners.
According to information contained in an invoicing document dated February 29, 2016 which the law firm sent to Press Trust, Chisanga & Tomoka had a meeting with the CEO [of Press Trust] to receive instructions “to urgently review and give an opinion” on three issues concerning Press Trust and PCL.
The issues were the trustees’ obligation to apply for court assistance, the timing of the appointment and retirement of directors on PCL and the trustees’ powers as regards the Board and GCEO [Group Chief Executive Officer] of PCL.
The document does not indicate the opinion which Chisanga & Tomoka gave on the issues.
But inside sources at PCL said this move was illegal in the first place.
“It does not make sense. Why now?” said one source, adding that the move justifies discomfort in PCL that the current administration is trying to get a foothold in the Press system for its own individual intentions.
Another source said: “No single shareholder, including Press Trust, has an undue influence on the operations of the company outside the board. And issues about tenure of trustees and GCEO are clearly spelt out in the Press Trust Reconstruction Act.”
Among other things, the Press Trust Reconstruction Act provides that a Trustee is supposed to serve for a term of six years and is eligible for reappointment once only for another period of six years.
It also says the Chairman of the Board shall be elected from among the eligible candidates among the trustees and shall hold office for one year.
However, Press Trust Chief Executive Officer Patrick Mhango dismissed the alarm bells around the Trust’s action to seek the legal opinion.
Mhango said the opinions sought from Chisanga & Tomoka were purely meant to guide the Trustees to make informed decisions about the appointment and removal of directors on the board of PCL.
“These directors are the ones that were sponsored on PCL board by Press Trust. After receiving the opinions decisions were made,” he said.
He did not say what these decisions were.
“Unfortunately, rules of corporate governance do not allow us to go into detail because there are other shareholders in PCL itself who are different legal entities from Press Trust and we cannot speak for them and neither would we want to offend them. This reply is restricted to issues relating to Press Trust,” he said.
He also declined to state the opinion which Chisanga & Tomoka gave.
“We do not think it would be prudent (on our part) to give you the opinions as requested. There are other issues covered in the opinions that are of a private nature and would breach some people’s right to privacy if made public,” he said.
He also parried away the argument of conflict of interest in that Press Trust sought a legal opinion from a law firm one of whose partners, Meyer Chisanga, is in the Board of Press Trust.
He said the opinion was sought from Yotam Longwe and before Chisanga was appointed into the board.
“Mr. Meyer Chisanga SC was not a Trustee when opinions were sought from his legal firm where he’s the senior partner. Mr. Chisanga SC has just been drafted into the board,” he said.
Rocking the Press system at the moment is also the appointment of DPP politicians Ben Chidyaonga and Peter Mwanza into the PCL Board in February this year.
The two were in the Press Trust Board for 12 years until July last year when their two terms expired.
They were not immediately replaced until February this year when Chisanga and Wilson Chirwa were appointed into the Board.
The hanging around of the two is seen as a move by the government to influence operations of PCL.
But in statement it released on Thursday, government said Mwanza was not a member of the DPP and that the Press system is, in fact, dominated by Malawi Congress Party members and sympathisers.
It also accused PCL management of creating the DPP presence scenario in their system to try to cover up “irregularities and criminal activities” under its watch.
“The list of alleged irregularities and illegal activities is a long one. PCL’s reluctance to provide the requested information [on executive packages, dividend payment details and dilution of government shareholding in PCL] is even more suspicious,” it said.
Government, which calls itself a majority shareholder in PCL, thus demanded an urgent shareholders meeting to assess the extent of the mismanagement at PCL.
PCL however hit back arguing, among other things, that government is not a shareholder in PCL and therefore does not have a mandate to call for a shareholders’ meeting.
A Press Corporation Limited Annual Report for 2014 shows that Press Trust has a 44.47 percent in PCL, Old Mutual has 14.37 percent, Deutsche Bank Trust Company America has 22.34 percent with the remaining 18.82 percent for others.
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