FOR­TUNES

Af­ter more than half a cen­tury as a fam­ily busi­ness, the ail­ing com­pany has reached out to an out­sider to turn it around and fo­cus on its fu­ture

CityPress - - Business - JUSTIN BROWN justin.brown@city­press.co.za

There is an irony of sorts, given the his­tory of South Africa, that a com­pany started by an Afrikaner en­gi­neer at the height of apartheid in the mid-1960s will next month have a black man and an out­sider at the helm for the first time. Former MTN SA CEO Mteto Ny­ati will take over as CEO of ail­ing Al­tron from Rob­bie Ven­ter, son of Bill Ven­ter – who started the com­pany in 1965 – on April 3.

Un­der the Ven­ter sons, Rob­bie and Craig, the Al­tron group has lost its way and this has caused the Ven­ter fam­ily to re­lin­quish con­trol, step aside and look for some­one else to run the com­pany for the first time in more than 50 years.

The change comes as Al­tron made losses in four out of the past five years – in 2016, 2015, 2014 and 2013, in­clud­ing a loss of al­most R1 bil­lion in 2013 and a record loss of R1.1 bil­lion in 2016.

Ven­ter se­nior and Rob­bie will re­main on the Al­tron board as nonex­ec­u­tive di­rec­tors.

The Ven­ter fam­ily still has an 18% eco­nomic in­ter­est in Al­tron and a 25.1% vot­ing po­si­tion.

Last month, Al­tron share­hold­ers backed the end of ab­so­lute con­trol by the Ven­ter fam­ily via a vot­ing struc­ture.

Ny­ati said dur­ing an in­ter­view this week that he had first been ap­proached by an ex­ec­u­tive search com­pany in July last year.

When the dis­cus­sions started, Ny­ati learnt what the com­pany was look­ing for and he dis­cov­ered that he could “add value”.

It was in­di­cated to Ny­ati that Al­tron was look­ing for a new CEO that had lo­cal and in­ter­na­tional ex­pe­ri­ence and a track record of suc­cess run­ning large en­ter­prises.

It was also im­por­tant that the new leader of Al­tron would con­nect with the fam­ily val­ues of the busi­ness, he said.

The se­lec­tion of the Al­tron CEO was a “very long” process that con­cluded in Fe­bru­ary this year, he said.

Ny­ati said the process in­cluded nu­mer­ous in­ter­views, in­clud­ing with Ven­ter se­nior, who in Fe­bru­ary was re­placed as Al­tron chair­man by Mike Leem­ing; Rob­bie Ven­ter, who is the out­go­ing Al­tron CEO; Al­tron board mem­bers; as well as the pri­vate eq­uity fund Value Cap­i­tal Part­ners (VCP), which is headed by Antony Ball and Sam Sit­hole, who are for­merly CEO and chief fi­nan­cial of­fi­cer of Brait, re­spec­tively.

VCP has a 15% stake in Al­tron.

He said that the man­date from the Al­tron board was that the group would fo­cus on in­for­ma­tion and com­mu­ni­ca­tion tech­nol­ogy (ICT).

Al­tron con­sists of Al­lied Tech­nolo­gies, Bytes Tech­nol­ogy and Power Tech­nolo­gies, which are in­vested in the telecom­mu­ni­ca­tions, IT and power elec­tron­ics in­dus­tries re­spec­tively. The plan would be to firstly turn around the group, Ny­ati said; then re­tain Al­lied Tech­nolo­gies and Bytes Tech­nol­ogy; and sell Power Tech­nolo­gies, be­fore do­ing ac­qui­si­tions that would aug­ment Al­tron’s ICT fo­cus, he said. Once the Al­tron turn­around had been com­pleted the fo­cus would be on “ac­cel­er­ated growth”, he said. “We first need to stop the bleed­ing. “It won’t be an easy trans­for­ma­tion. There needs to be a change made to the com­pany struc­ture and the way peo­ple are in­cen­tivised,” he said. “The chal­lenges are go­ing to be huge. “The trans­for­ma­tion of the busi­ness will make it rel­e­vant in a dig­i­tal world,” he said. Cur­rently, Al­tron’s var­i­ous units op­er­ated in si­los and the chal­lenge was to make the group’s com­pa­nies more cus­tomer-fac­ing. Ny­ati said a “big op­por­tu­nity” in the ICT space was the use of cloud com­put­ing – which is the use of a net­work of re­mote servers hosted on the in­ter­net to store, man­age and process data. Al­tron would look to be­come the pref­er­en­tial provider of ICT ser­vices to lo­cal busi­ness and gov­ern­ment, he said. Once he starts at Al­tron, the key is­sue for him would be to con­duct a re­view of the group. “We need to look at the mis­sion of the group, strat­egy, fo­cus and new ar­eas of ICT,” Ny­ati said. The re­view would take up at least the first 90 days. Ny­ati said that his am­bi­tion for the Al­tron busi­ness was to re­tire at the com­pany and leave it op­er­at­ing at a re­ally im­por­tant ICT place. He would also like to see Al­tron in­crease its busi­ness out­side South Africa, in­clud­ing the rest of Africa, and else­where in the world to en­sure a bal­anced po­si­tion, given his ex­pe­ri­ence at MTN. Ny­ati (52) is from Mthatha in the East­ern Cape. He holds a Bach­e­lor of Science de­gree in me­chan­i­cal engi­neer­ing from the Univer­sity of KwaZulu-Na­tal. He has worked for Afrox, Tas­tic Rice, Nam­pak, IBM SA, Mi­crosoft SA and MTN, which in­cluded be­ing Mi­crosoft SA manag­ing di­rec­tor and MTN SA CEO. He has pre­vi­ously served as a nonex­ec­u­tive di­rec­tor of Ad­vTech and Blue Labour Tele­coms. In 2004, he was named one of Yale Univer­sity’s world fel­lows on global lead­er­ship. In 2013, he won the male busi­ness per­son­al­ity of the year at the Oliver Trans­for­ma­tion and Em­pow­er­ment Awards. In 2014, the In­sti­tute of In­for­ma­tion Tech­nol­ogy Pro­fes­sion­als of SA made him its IT per­son­al­ity of the year.

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