Kirsh duo want Foneworx nonexecutive directors removed

SIGNALLING a vote of no confidence in the nonexecutive directors of FoneWorx, William and Issie Kirsh — who through their family trusts are majority shareholders in the telecommunications and information technology solutions provider — are rallying other shareholders to remove them from the company.

The Kirsh family hold about 33% of AltX-listed FoneWorx — which provides the technology platforms for companies to run short message service (SMS) competitions — as well as a 75% shareholding of the Value+ Nettwork group.

Last December, the companies announced plans to merge, to create a R478m entity, in which 10 areas of potential between the two entities had been identified by Value+ founder William Kirsh — who until 2009 served as CEO of media group Primedia.

In a statement issued yesterday, the family said there was a “poor state of corporate governance” at FoneWorx, and they would request that the board of directors call an extraordinary general meeting of shareholders in terms of the Companies Act to remove and replace the nonexecutive members of the board, and retain the executive directors to implement the merger.

“In our view, the fundamental corporate governance weaknesses at FoneWorx are undermining the shareholders’ opportunity of building shareholder value,” Issie Kirsh said.

“The extraordinary general meeting will be the most objective measure of shareholders expressing their views.

“We urge the board to schedule this important meeting without delay,” he said.

William Kirsh confirmed the support of the Kirsh family and Value+ shareholders to achieve a successful merger. “We have been aware of these corporate governance weaknesses and intended to resolve them post the implemen- tation of the merger. We are proposing to reconstitute the nonexecutive members to restore proper governance, achieve the merger and build shareholder value in FoneWorx,” he said.

The statement said that FoneWorx had failed to develop strategies that would enhance shareholder value, both strategically and financially.