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Johannesburg - MTN Group [JSE:MTN] shareholders approved a R33m windfall for outgoing boss Phuthuma Nhleko on Thursday.
The settlement, which will be due in a once-off sum, is payable on April 1 2011 and is in respect of a three-year restraint of trade.
This dwarfs the R7m paid per year for two years to Alan Knott-Craig when he exited Vodacom Group [JSE:VOD] in 2008.
Nhleko, whose contract expired on June 30, agreed to stay on in his role until March 2011. A market source viewed the payment at "reasonable", given Nhleko's extensive contact base, particularly in Africa, and compared to local and international restraint payment standards.
At an annual general meeting on Thursday afternoon, 72% of shareholders gave the go-ahead for the pay-out.
Nhleko will also be entitled to own up to 5% of MTN’s shares in addition to the R33m in restraint of trade payments.
Vestact analyst Sasha Neryshkine reckoned the payment was justified.
"He knows a lot. He's very smart, an investment banker formerly," Neryshkine said. "There's always something on the go at MTN. And imagine what he could tell Bharti Airtel should it want to employ him."
Commenting on comparisons with the golden handshake meted out to Knott-Craig, Neryshkine said: "In South Africans' minds, Vodacom has this place, but MTN is a much bigger company, with far, far broader reach. Given this is a three-year restraint, I think it's totally reasonable."
Earlier on Thursday, MTN unveiled the details of an R8.1bn black economic empowerment transaction.
- Fin24.com
The settlement, which will be due in a once-off sum, is payable on April 1 2011 and is in respect of a three-year restraint of trade.
This dwarfs the R7m paid per year for two years to Alan Knott-Craig when he exited Vodacom Group [JSE:VOD] in 2008.
Nhleko, whose contract expired on June 30, agreed to stay on in his role until March 2011. A market source viewed the payment at "reasonable", given Nhleko's extensive contact base, particularly in Africa, and compared to local and international restraint payment standards.
At an annual general meeting on Thursday afternoon, 72% of shareholders gave the go-ahead for the pay-out.
Nhleko will also be entitled to own up to 5% of MTN’s shares in addition to the R33m in restraint of trade payments.
Vestact analyst Sasha Neryshkine reckoned the payment was justified.
"He knows a lot. He's very smart, an investment banker formerly," Neryshkine said. "There's always something on the go at MTN. And imagine what he could tell Bharti Airtel should it want to employ him."
Commenting on comparisons with the golden handshake meted out to Knott-Craig, Neryshkine said: "In South Africans' minds, Vodacom has this place, but MTN is a much bigger company, with far, far broader reach. Given this is a three-year restraint, I think it's totally reasonable."
Earlier on Thursday, MTN unveiled the details of an R8.1bn black economic empowerment transaction.
- Fin24.com
