| Mon 9 Nov 2009, 12:28 | | ADR - Adcorp - Results Of Arbitration |
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ADR
ADR
ADR - Adcorp - Results Of Arbitration
Adcorp Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1974/001804/06)
Share code: ADR & ISIN: ZAE000000139
("Adcorp" or "the Company")
RESULTS OF ARBITRATION
Shareholders are referred to the announcement released on SENS on 29 October
2009 where they were advised that the parties to a recent dispute regarding the
suspension of the Group Chief Financial Officer ("CFO"), Faunce Burd, as well as
certain other senior employees have agreed to refer this matter for private
arbitration before a senior advocate.
Shareholders are hereby advised that Adcorp has been cleared in arbitration, on
Friday 6 November 2009, by a senior advocate in the dispute regarding the
suspension of the Group CFO, along with five other employees.
The arbitrator Advocate Roland Sutherland SC, has found in favour of the Company
in respect of all issues dealt with in terms of the arbitration agreement and
has ruled that all six employees be summarily dismissed.
The employees had previously brought an action in the Labour Court requesting an
urgent interdict to prevent the Company from instituting any disciplinary action
against them and demanding their immediate reinstatement following their
suspensions.
The employees claimed they had been victimised having made a number of serious
but unsubstantiated allegations of fraud, corruption and racism against two
senior Company officials which they claimed to be a "Protected Disclosure" in
terms of the Protected Disclosures Act.
In this regard, the arbitrator found that there was no merit to the claim of
protected disclosure and that it was doubtful that these employees actually ever
believed this to be a protected disclosure in terms of the Protected Disclosures
Act.
One of the issues that the arbitrator heard evidence on related to an allegation
of "material misrepresentation and fraud" relating to an alleged overstatement
of profit by Adcorp of R1,88m with respect to a profit share arrangement
relating to a supplier of employee benefit products, Crestfin Financial Services
(Pty) Limited.
During questioning on this matter during the arbitration, the group`s auditors
indicated that they had no grounds to suspect that there had been a material
misrepresentation or fraud with regard to this transaction.
Whilst Faunce Burd has been summarily dismissed as an employee of Adcorp in
terms of the arbitration ruling, she has yet to be formally dismissed as a
director of the Company. The process to have her removed as a director will
commence in due course and shareholders will be advised of this accordingly.
Bryanston
9 November 2009
Sponsor
Deloitte & Touche Sponsor Services (Pty) Limited
Date: 09/11/2009 12:28:19 Produced by the JSE SENS Department.
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