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Headless horse

INVESTORS do not like uncertainty regarding company leadership. Watch Apple's share price today if you need proof of that. For Telkom [JSE:TKG], one of the most undervalued companies on the JSE, it really is time to sort out the chief.

Steve Jobs, the man who founded Apple and pulled it out of its doldrums when he returned ten years ago, has taken off sick again leaving the company's COO Tim Cook to run the show. Jobs chose a US public holiday to make the announcement, avoiding an initial hit on the stock. It'll come today.

Telkom's announcement - that current interim CEO Jeffrey Hedberg will leave in three months - was less graceful thanks to astute journalism at technology news website TechCentral.

The cat is out of the bag and investors want to know what Telkom's plan is when Hedberg departs.

The story goes that Jeff Molobela, the chairperson of Telkom's board that takes care of government's interests in the company, asked Hedberg to stick around until November.

The latter declined and is clearly not interested in running the show on a permanent basis.
 
Molobela himself is apparently on the way out too, but government wants to maintain a hold on Telkom via its special shares that allow escalated voting rights. Minister of communications, Roy Padayachie has said as much.

Government is losing its privileges with regard to Telkom, however. It still has a sizable share in the company, but the special nature of those shares contravene the King III corporate governance framework that must be adhered to by listed companies.

Telkom must comply by March. The same month Hedberg will go. And it is uncertain who will take the reigns from him.

Recent allegations of corrupt business dealings and the political tug of war that wages on above Telkom at all times are enough to put off even the most gung-ho of potential chief executives.

The only reason anyone would want the job is to make a few bar in a few months and then hit the high road.

Unless they could turn it around.

The latent potential is massive if Telkom can get rid of the government once and for all and leverage its infrastructure into a sensible strategy.

Meddling ministers are the last thing any company needs and will ensure that Telkom goes the way of the SABC and Sentech if it is allowed to continue.

On the other hand, Telkom has considerable infrastructure and some rocking business units. It could go the way of BT (ex British Telecom) and become a successful, privatised, multinational  telecoms operator if things are handled properly.

If it were up to me Nombulelo 'Pinky' Moholi would get the job. Currently the head of Telkom SA, Moholi is the classiest, most experienced and apparently capable person I've met within Telkom.

And if you're a betting person, then the Telkom share, currently just shy of R36 is tempting. But going there does require a fair amount of faith.
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