By Shinovene Immanuel | 5 October 2018
TWO powerful executives responsible for overseeing Swapo’s N$500 million business empire are at each other’s throats over the firing of a director who raised a red flag about allegedly fraudulent business deals.
Lawyer Clive Kavendjii and Erastus Nekuta, a former technical adviser to former First Lady Penehupifo Pohamba, are among five nominee shareholders who exercise control over Swapo-linked businesses, including investment houses Zebra Holdings and Kalahari Holdings.
The other nominees are the former city of Windhoek chief executive Niilo Taapopi, Hans Boois and Erica Akwenye.
Kavendjii has accused Nekuta and nominees linked to him of acting illegally by firing Jerome Mutumba, the chairperson of shadowy Swapo company Guinas Investment three weeks ago. Four out of five nominee shareholders endorsed the dismissal of Mutumba in the absence of Kavendjii.
Kavendjii believes the nominees have no power to sack the directors of Swapo subsidiaries, and that only the party’s political bureau can do this.
Nekuta hit back by accusing Kavendjii of hypocrisy and double standards, saying he was likewise involved in sacking the boards of Zebra Holdings and Kalahari Holdings two years ago.
The Namibian reported last week that Mutumba had written to Swapo’s economic affairs secretary, Alpheus !Naruseb, to report that Guinas had lost millions of dollars in “what appear to be dubious transactions” over the years.
The Namibian understands that the Guinas board knows of allegedly irregular deals worth N$21 million, including the sale of shares valued at N$16 million from mining company Rosh Pinah Zinc, and N$5 million from Guinas’s stake in a Lüderitz hotel.
Mutumba declined to comment. However, his letter to !Naruseb indicated that he believes there is an attempted cover-up.
He wrote: “Contrary to what you could have been told, the current chairperson of the Guinas board is being made a scapegoat to divert and silence the collective view of the board on the matter of the buy-back of shares.”
Kavendjii, who was appointed a nominee shareholder in 2016, is facing a revolt from Nekuta and other older business leaders, who feel the lawyer is encroaching onto their turf.
Sources said the decision to fire Mutumba, who has been tipped for a diplomatic appointment, stems from Guinas’ decision to refuse to pass on the N$16 million from Rosh Pinah Zinc to Swapo.
The Guinas board is understood to want to reinvest the money in the company.
Kavendjii explained his concerns about the sacking of Mutumba in his letter dated 16 September 2018.
“No Solomonic wisdom is required to know that it is only the political bureau as the appointing authority that has powers to recall and/or dismiss directors of Swapo party companies,” he said.
The Swapo constitution does not give nominee shareholders the power to appoint or dismiss directors in any organ of the party, he added.
“Nekuta seems to be of the view that because the nominee shareholders have oversight over the boards of Swapo party companies, and the directors are accountable to the nominee shareholders, [they] can dismiss directors of Swapo party companies,” he said.
“This position is ill-conceived, untenable and [has] no support in law”.
He said nominee shareholders must compile a report explaining the alleged sins committed by Mutumba or the Guinas board.
This report should include recommendations for submission to the party’s economic department, which, if there is sufficient evidence, would then forward it to the Swapo secretariat, he stated.
“The secretariat can, in turn, escalate the matter to the political bureau for a final decision,” Kavendjii said.
Nekuta and his group had not followed these steps, and this could result in a court challenge, he reasoned.
“The decision to dismiss Mutumba can have far-reaching ramifications for the Swapo party. It can cause serious embarrassment if the affected individual is to challenge the decision,” he said.
“It is reckless, odious, insidious and nefarious for a person appointed by the Swapo party as a deputy chairperson of the nominee shareholders to adopt a stance which is inconsistent with the Swapo party and the laws of the land.”
Kavendjii cited the court action by Job Amupanda and others against Swapo as an example of what can happen if due process is not followed. Amupanda and three others won a court case in 2016 after the party had expelled them.
Kavendjii said he had asked Nekuta on 14 September 2018 why Mutumba had been fired.
“He [Nekuta] simply said this was not necessary. Again, this is a fatal defect in the process,” he added.
Kavendjii said a person must be provided with reasons, and be given a fair hearing before a decision is taken against him or her.
Kavendjii declined to comment when asked by The Namibian. Nekuta hit back at Kavendjii.
“Which due process did he follow and which political bureau did he consult when he fired the board of Kalahari Holdings under the chairmanship of Kalumbi Shangula, and the board of Zebra Holdings under the chairmanship of comrade Andrew Ndishishi?” he asked in an interview this week.
“Why does he want to apply the party constitution selectively? Kavendji did not attend the meeting which decided on firing Mutumba,” said Nekuta, who insisted that the nominee shareholders had the legal power to dismiss Mutumba.
He added that Kavendjii is “being hypocritical and playing double standards, which is dangerous and moving him towards a very slippery slope”.
This is not the first time that Nekuta and his group have fired a Guinas board member who questioned alleged irregularities at the secretive company. In 2011, Maria Nakale-Gaomas and other directors were dismissed, allegedly because they were probing the ownership structure of certain Guinas subsidiaries. Nakale-Gaomas declined to comment.
When this was put to him, Nekuta accused The Namibian of “comparing apples with bananas”.
The Namibian, however, understands that some board members do not agree with the decision to fire Mutumba, and could meet this week for their usual meetings.