Business

NetOne board dissolved

Government has dissolved the NetOne board.

The decision came hardly two months after the suspension of chief executive officer Lazarus Muchenje, who also accused the board of breaching corporate governance principles.
Muchenje is challenging his suspension and the case is being heard today.

NetOne is one of the State-owned enterprises (SoEs) earmarked for urgent disposal either through a private placement, which would place it in private hands, or an initial public offering, which would make it Zimbabwe’s second publicly-traded mobile telecoms company after Econet Wireless Zimbabwe.

Finance Minister Mthuli Ncube said last week the disposal of NetOne could take place “in the next six months”.

ICT and Courier Services minister Kazembe Kazembe, could not be reached to give reasons for his decision. The NetOne board chaired by Peter Chingoka, the board comprised of Sydney Nyanungo, Nyengeterai Mahaka, Ruth Ncube, K Mudukuti, Georgina Chingonzo, Theophilus Damba, G Madzorera and Nancy Samuriwo.

Nyanungo deputised Chingoka.

NetOne company secretary Theresa Muchinguri confirmed the board dissolution, with immediate effect, in a letter to all employees on Monday this week.

“Please, note that the Hon. Minister of ICT and Courier Services (Kazembe) has dissolved the NetOne board with immediate effect and a new board shall be appointed in due course,” Muchinguri said.

In August, Muchenje sued former ICT Minister Supa Mandiwanzira, six board members, nine fired executives and the Office of the President and Cabinet for allegedly breaching corporate governance rules.

Muchenje’s predecessor, Reward Kangai, also accused the board of bad corporate governance practices before he was eventually fired.

“That board was grossly incompetent, never paid attention to their fiduciary responsibilities to NetOne, but was bent on pleasing their corrupt master and, therefore, ensuring their stay at NetOne,” one NetOne insider said.

“They engaged on a management restructuring exercise after they had been advised by the State Enterprise Restructuring Authority, (SERA) in August 2015, to await Cabinet approval of the NetOne turnaround plan.

The structure was also top heavy, whereas SERA was advocating for a leaner structure.”

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