Suspended Choppies Chief Executive Officer (CEO) Ramachandran Ottapathu has vowed to fight for the retail empire he built for over 27 years. This, he says, he will do to his last breath.
In an interview Ottapathu said the board made a reckless decision to suspend him based on hearsay without any concrete evidence.
“There is no interim report which can suggest that I have done something wrong; it is just some personal vendetta against me,” said the furious Ottapathu.
Asked why he thinks there is a personal vendetta against him, the man who built the Botswana Stock Exchange (BSE)–listed company said it seems he ruffled feathers among board members when he suggested that the board of directors should be restructured.
“The reason I suggested board restructuring was to bring people who have experience in retail industry because most of the board members have none. This was also for us to improve on governance,” he said, adding that he also wanted to have a deputy CEO.
A few days after his suggestion, he was shocked to hear about his suspension from social media before the board could serve him with the suspension letter.
Ottapathu, who is a major holder of Choppies together with Farouk Ismail – who is now the acting CEO –, said most of the board members don’t have the interest of the company at heart.
Board chairman not hands on
He accused the board chairman former President Festus Mogae of not being hands-on, saying he often misses board meetings.
“Due to his schedule as statesman he has missed lot of board meetings and Robert Mathews is the one who has been chairing most of the meetings. Only Farouk normally check on me about the performance of the company,” he revealed.
He said Mogae has been the board chairman since 2008 and there is need to look for fresh ideas.
Asked about his relationship with Mogae, Ram as he is commonly called, just said that he is a board chairman. He said that most of the board members didn’t spent a Thebe in building the Choppies brand but were given shares on silver platter.
“They didn’t build this company but it was me and Farouk who contributed immensely to the growth of this company,” he hit out. He said that should the company face some challenges it will be him and Farouk who will be ready to put more money into the company.
“None of the board members have run their own businesses and if this empire collapse they were will be roped in by some organisations as board members,” said Ram.
Mogae was roped in as Choppies board chairman in 2008 after stepping down as the fourth president of Botswana on what was viewed as strategic move by one of the biggest retail group in Southern Africa.
Cash flow issues
He admitted that Choppies, which is listed on the BSE, has failed to release financial results and attributed that to some factors. One of the factors is that the company has some cash flows issues which the auditors are still dealing with.
“They are also delayed because of stock take and some of the acquisitions in Botswana has raised eyebrows hence the delay in releasing the financial results,” he revealed, adding that they engaged have forensic auditors from South Africa.
Meanwhile sources within the company confirmed that former President Mogae addressed a meeting of the company’s senior management to officially inform them about their CEO’s suspension. It is said he maintained that the suspension was a routine business practice that is usually undertaken to allow thorough investigations.
The Board announced Ottapathu’s suspension on Tuesday and immediately placed a notice with the BSE while appointing Farouk Ismail – Choppies founder – as Acting CEO.
Board’s statement
“Shareholders are referred to (i) the various announcements regarding the delay in the publication of the Group’s audited annual financial statements for the year ended 30 June 2018 (the “2018 Financial Results”), the last of which was published on 5 March 2019, and (ii) the related cautionary announcements. 2. As announced on 1 November 2018, the trading of the Company’s shares on both the Botswana Stock Exchange Limited and Johannesburg Stock Exchange Limited remains suspended pending the Company’s publication of its 2018 Financial Results.
In accordance with the Listings Requirements of the BSEL and the JSE, the board of directors of Choppies hereby informs the Choppies shareholders and the general public that, at a duly convened meeting of the Board held on 20 May 2019, the Board resolved to suspend from duty the Chief Executive Officer of the Company, Mr Ramachandran Ottapathu.
The suspension of Mr Ottapathu takes effect from Wednesday 22 May 2019 and will subsist until such date as the Board determines the action, if any, to be taken in implementation of the recommendations made in the investigation reports that will follow the completion of the legal and forensic investigations announced by the Company on 5 March 2019. The legal investigation is anticipated to conclude by the end of May 2019 (having extended from the end of April 2019). The forensic investigation is anticipated to conclude by the end of June 2019.
Farouk Ismail, the current Deputy Chairman of the Board, will, with effect from 22 May 2019, assume the role of Interim Acting Chief Executive Officer.
The Board further informs the shareholders of Choppies and the public that Redford Capital has, with effect from 13 May 2019, been appointed to the role of ‘Chief Restructuring Officer’ of the Company. The role of the CRO will, in summary, entail reviewing the Choppies business and identifying various action plans for implementation within the business to improve it. Redford is a South Africa based firm with over 25 years’ experience in providing business related services that include assisting its clients to resolve challenges and meet strategic and operational objectives. Redford is not a related party to Choppies (in terms of the BSEL Equity Listings Requirements). These announcements are made for information purposes only.”