Golding axed over a R24m share purchase

Hosken Consolidated Investments executive chairman Marcel Golding has been suspended over the purchase of R24-million worth of shares in Ellies Holdings, allegedly without authorisation, according to court documents.

Golding's decision to invest in the TV equipment company on behalf of HCI unit Sabido Investments was made "without the necessary authority and mandate of the board," according to an attachment to a labour court application from Golding, in which he seeks to overturn his suspension.

"I contend that I acted in good faith in what I at the time believed to be the third respondent's best interests in purchasing the shares," Golding said in the court application, referring to Sabido.

HCI is the largest investor in hotel and casino operator Tsogo Sun Holdings. It owns controlling stakes in a bus service, independent broadcaster e.tv and a bingo centre operator.

The company's largest shareholder with a 29% stake is the Sactwu Investment Group, the investment arm of the SA Clothing and Textile Workers' Union.

Hosken's shares fell by as much as 6.8% in early trading to R142.51, the lowest on an intraday basis since April 4, following the news that Golding had been suspended for gross misconduct.

The Ellies transaction involved less than 1% of Sabido's revenue, Golding said in the court documents.

"It is my understanding of the manner in which we have conducted business in the past that the CEO had discretion to make investment decisions on behalf of the company, with the expectation that they would subsequently be ratified," he said.

Ellies's share price has fallen by 85% over the past year as it struggled with cashflow.

Hosken's financial director, Kevin Govender, was not available for comment.

"The alleged misconduct by Mr Golding, while serious in nature, is unlikely to adversely affect the operations of the company, or materially affect its financial performance," the company said yesterday.