The gloves are off in the battle between Old Mutual and its former CEO Peter Moyo, who has accused the insurer’s chair, former finance minister Trevor Manuel, of being heavily conflicted in overseeing the managed separation of the SA business from its UK operations.
Moyo was suspended on May 23, hours before the insurance group’s annual general meeting, on the grounds of "a material breakdown in the relationship of trust and confidence", and was dismissed on June 18.
The breakdown was attributed to a conflict over dividend payments to a private company cofounded by Moyo and in which Old Mutual was invested.
Moyo wants to be temporarily reinstated as CEO and is claiming damages. He is also calling on the court to declare Old Mutual’s nonexecutive directors, including Manuel, delinquent. In court papers at the centre of his bid for payment of damages by Old Mutual, Moyo claims Manuel was "determined to get rid of me" after he challenged Manuel about the conflict.
Manuel ignored Moyo’s objections and 'from that point on, Mr Manuel’s attitude towards me deteriorated'.
Manuel’s roles as chair of Old Mutual Group SA, Old Mutual plc and Rothschild represented what Moyo called a "triple conflict of interest".
Old Mutual’s spokesperson Tabby Tsengiwe declined to comment on Moyo’s allegations but said the company is opposing Moyo’s application and will use the court process to respond to his claims.
In the papers lodged with the Gauteng High Court, Moyo stated, "it all started in or about March 2018 when I raised to Mr Manuel, in good faith and for no personal gain, my genuine concerns around what I perceived as a triple conflict of interest on the part of Mr Manuel".
Moyo alleges a proposal to transfer a R5bn contingent liability from Old Mutual Plc to present-day Old Mutual Ltd was central to the conflict. If the transfer was rejected then, says Moyo, the entire managed separation project would probably have been aborted.
"One of the companies which stood to benefit most from the realisation of the managed separation project was Rothschild, which stood to gain, and eventually did gain, hundreds of millions of rand in fees as one of the transaction advisers," said Moyo, whose own R15.4m payment under the "managed separation plan" has been forfeited.
Moyo said he objected to Manuel about "the impropriety of his participation in any discussions regarding our proposed assumption or takeover of the Old Mutual Plc contingent liability, which was in the nature of a guarantee in favour of an American company."
Manuel ignored Moyo’s objections and "from that point on, Mr Manuel’s attitude towards me deteriorated," Moyo said. He also queried the payment of Manuel’s legal fees in his 2018 battle against the Guptas.
The extent of the breakdown in relations is evident from a letter to Moyo, contained in his court papers, from Old Mutual’s lawyers. The letter states that in the calculation of notice pay that is due to Moyo it will not include the cost of providing company vehicles and their drivers, or bodyguards. It also says Old Mutual wants its Macbook back but might consider selling it to Moyo, once it has been cleaned of all its information.
In addition the letter confirms Moyo will not benefit from any incentives that had not vested or accrued to him by the time of his termination on June 17.
Shares awarded to Moyo in terms of the "managed separation incentive plan" have lapsed or have been forfeited, say the lawyers, who add that even if Moyo had not been terminated those shares could have still been reduced at the discretion of Old Mutual under its remuneration committee rules.
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