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Golding suspended for refusing favourable Zuma coverage

John Copelyn allegedly changed lock of Golding’s office.

Five days after a report on state- funded upgrades to South African President Jacob Zuma’s private home, one of his ministers attempted to influence news coverage at the country’s only private free-to-air television station, according to a lawsuit.

“I got a call from Minister Patel today,” Yunis Shaik, a director of the company that controls e.tv, said in a March 24 e-mail to suspended Hosken Consolidated Investments Ltd. Chairman Marcel Golding, according to court filings by the executive aimed at overturning his suspension. “He says that President Zuma this day opened a new dam. He wants us to cover it tonight. As this is a big story, it might be a good lead story.”

The e-mail, referring to South African Economic Development Minister Ebrahim Patel, is attached to court papers filed yesterday by e.tv Chief Executive Officer Marcel Golding. Golding says his opposition to political influence over the station’s news agenda is the real reason he has been suspended as executive chairman of Hosken Consolidated Investments Ltd., the Cape Town-based investment company which controls the T.V. company.

In the papers Golding said “he was unwilling to compromise on the issue of independence and integrity of editorial content.”

Hosken said yesterday Golding had been suspended for gross misconduct of a “very serious nature” — a decision that’s being legally challenged by the executive and co-founder. According to Golding’s labor-court application, Hosken said Golding was suspended for asking Investec Ltd. to buy 24 million rand ($2.19 million) worth of shares in television equipment company Ellies Holdings Ltd. on behalf of Hosken unit Sabido Investments (Pty) Ltd., of which he is the chief executive officer.

 

Editorial Direction

Golding said the company said he ordered the purchase “without the necessary authority and mandate of the board,” according to the court documents. He said he believed that — as CEO — he was authorized to make the investment decision and that the case had been compiled as a pretext to remove him.

Shaik declined to comment when contacted by phone and said he will issue a response later. Themba Matebula, a spokesman for the Department of Economic Development, said Patel wasn’t immediately available and requested queries by e-mail. Mac Maharaj, Zuma’s spokesman, didn’t immediately respond to a voice mail and text left on his mobile phone.

In alleging attempted influence of news coverage, Golding said in the court application that the South African Clothing and Textile Workers Union, which is aligned to the ruling African National Congress and is Hosken’s biggest shareholder, “has persistently attempted to influence the editorial direction of e.tv news in order to further its agenda.” Shaik represents the union on Hosken’s board, according to Golding in the documents.

 

‘Normal Requests’

“We are very saddened by this allegation” of attempts to influence the e.tv news agenda, Andre Kriel, general secretary of SACTWU, said in an e-mailed response to questions. “We have not done so, other than our normal requests for our events to be covered. We do the same with all other media.”

Hosken is a black-empowerment investment company, set up to take advantage of legislation to make up for discrimination during the apartheid era, when non-white South Africans were hindered from participating in the economy. South African laws compel companies to sell stakes to black investors.

 

‘Not Acceptable’

The dispute pits former labor union activist Golding against Shaik.

“Shaik has been endeavoring to increase his power and influence in the company,” Golding said in the court filings. “He purports to speak on behalf of those close to the central levers of state power.”

Shaik’s brother, Schabir, was convicted in 2005 of bribing Zuma, then the deputy president, and jailed. He denied wrongdoing and appealed the conviction unsuccessfully.

Shaik’s alleged attempt to sway news coverage came five days after South Africa’s anti-graft ombudsman found Zuma guilty of misconduct over the government’s spending of 215 million rand on his rural home at Nkandla, including the construction of a pool and an amphitheater.

After not getting a response from Golding, who was at a conference, Shaik contacted news staff at the channel to suggest Zuma’s opening of the dam be covered, according to the court documents.

E.tv Chief Operating Officer Bronwyn Keene-Young, Golding’s spouse, said to Shaik by e-mail that his decision to contact the editorial team directly when she and Golding were unreachable was “really not acceptable.”

“The whole issue of news and news integrity is a sensitive and a fragile one,” she said in an e-mail cited in the court filing.

Keene-Young declined to comment when called by Bloomberg.

 

Infrastructure Program

Shaik replied that the pair had promised Patel they would cover South Africa’s infrastructure program. The notion that he was jeopardizing media values by contacting editorial staff is “simply ridiculous,” he said by e-mail.

The attempted interference didn’t stop there, according to the documents. Shaik texted Golding on May 19 saying it “would be terrible” if an e.tv feature on gambling addiction features Tsogo Sun Holdings Ltd., the casino and hotel operator of which Hosken is the biggest investor. On Aug. 14, SACTWU’s Kriel requested e.tv cover a live speech to be delivered by Patel, according to the court filings.

The conflict has ended Golding’s 19-year business relationship with Hosken co-founder John Copelyn, who last week had the lock on Golding’s office changed, according to Golding’s comments in the filing. Hosken Financial Director Kevin Govender, said the company filed opposing court papers yesterday and can’t comment further.

Golding didn’t immediately respond to an e-mail requesting comment. His lawyer Lawrence Whittaker declined to comment while Copelyn didn’t immediately respond to phone calls and and an e- mail.

Hosken shares fell as much as 6.8 percent yesterday before closing less than 0.1 percent up at 153.04 rand in Johannesburg. Ellies stock climbed 40 percent, the most since 2007, to 1.34 rand.

©2014 Bloomberg News

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