Old Mutual is not backing down. It says it will fight the legal battle launched by its axed CEO Peter Moyo, who has asked a high court to prevent the insurance giant from appointing a successor to his position because he wants his job back.
The insurer’s decision to oppose Moyo’s urgent application, which will soon play out at the Johannesburg High Court, adds another twist to what is shaping up to be a protracted and nasty legal battle between the two parties.
“Old Mutual has indicated that it will oppose Mr Moyo’s application and will use the court process to respond to his claims,” Old Mutual spokesperson Tabby Tsengiwe told Moneyweb.
The company had until July 1 to inform Moyo and his lawyers whether it would oppose the court application. Its decision to do so means the matter might be heard in court as soon as July 16.
Moyo, who was suspended on May 23 and dismissed on June 18 over a conflict of interest involving investment holding firm NMT Capital, which he co-founded, is not going down without a fight.
Not only does he want the high court to temporarily reinstate him as Old Mutual CEO and prevent the insurer’s board from appointing his successor until the court makes a ruling on his application, he also wants the court to impose sanctions on Old Mutual directors.
Old Mutual has appointed chief operating officer Iain Williamson as acting CEO.
‘Delinquent directors’ application
In his 165-page urgent application that was launched on June 28, Moyo asked the court to declare Old Mutual chairman Trevor Manuel and 12 other non-executive directors as delinquent under the Companies Act – a move that could see the high court censure their conduct and sully their reputations.
Moyo said the decision by Old Mutual to place him on suspension was “humiliating” and the suggestion that he was guilty of a conflict of interest was damaging to his reputation.
He also placed Manuel at the centre of Old Mutual bringing charges against him. Moyo accused Manuel of always “gunning” for him by “bullying other directors” to pursue the NMT Capital conflict of interest matter for “some inexplicable and ulterior purpose”.
Asked about Moyo’s allegations, Old Mutual’s Tsengiwe said: “It would not be appropriate to comment further while legal proceedings are pending, and we would caution the media or any other party against publishing any untested allegations as fact.”
Old Mutual is NMT’s only institutional shareholder, with the insurer owning a 20% stake that it earned through a series of funding it provided to NMT totalling R201.5 million since 2004.
Actual reason for dismissal at issue
Moyo declared his NMT business interest when he returned to Old Mutual in 2017, first when he headed the company’s emerging markets arm before taking up the group CEO role. And Old Mutual was comfortable with Moyo’s declaration and its processes to manage the conflict.
Moyo believes that his sacking was linked to him raising concerns about two incidents. In March 2018, Moyo said he queried Manuel’s “triple conflict of interest” regarding Old Mutual’s managed separation, a transaction that saw the insurer return to its South African home market from the UK.
According to Moyo, Manuel, at the time, was a director of the insurer’s parent company Old Mutual plc, Old Mutual Limited and financial advisory firm Rothschild & Co. Moyo said Rothschild’s earned “hundreds of millions of rands in fees” from advising Old Mutual on the managed separation – raising a conflict on Manuel’s part.
In another incident, Moyo said he questioned why Old Mutual was paying Manuel’s legal fees in his matter against the controversial Gupta family and their associates as it didn’t have “anything to do with Old Mutual”.