Omnia puzzle deepens as Rod Humphries ‘quits’ |
Chairperson thought to have fallen on his sword in the wake of the firm’s latest scandal
OMNIA CHAIRPERSON Rod Humphris, who has been with the chemical manufacturer for more than three decades, “has been scalped” in the wake of the firm’s latest scandal, analysts said yesterday, following his impromptu resignation with immediate effect.
Omnia had reportedly misled the market about a R2 billion rights offer.
Independent analyst Anthony Clark said given that most of Omnia’s debt and acquisitions that had led to its current precarious financial state were contracted under Humphris’s tenure, and that the free fall of the share price in recent days is attributed to the man at the top, the now former chairperson “either fell on his sword or his scalp has been taken”.
“When companies are in a difficult position, it is always the guy who is chairperson, who has been chief executive, who takes the fall,” Clark said.
Omnia is being looked at crosseyed after it announced on April 23 that its finances were in order, which bolstered shareholder and investor confidence, only to turn around a few weeks later and declare it would need to issue a R2bn rights offer to stabilise its finances and operations.
Humphris was to retire from the board at the group’s AGM in September, but “in order to facilitate a smooth changeover”, he had decided to step down as chair “immediately”, the group announced yesterday.
“The company today is vastly different from the one that I joined in 1982 as a young project engineer. I personally enjoyed, in the latter part of my career, the challenge of building up a chemical company with a myriad chemical services from a company that was renowned as an agriculture company,” Humphris said.
Ralph Havenstein, the board’s lead independent director, will succeed Humphris, who has spent 20 years on the board, including as non-executive chairperson since June 2017.
“Omnia has always been synonymous with Humphris, but to go forward – and quickly – because there is the R2bn equity to be raised, the group needed someone with experience from inside for continuity,” Clark said of Havenstein’s appointment.
Omnia shares slipped to a 10-year low this week after the group said it needed to issue fresh equity to cut debt. Omnia’s shares were 1.2 percent up at R43.89 after the announcement on Thursday and closed at R43.50.
A year ago, the stock was at R130.50. The decline is partially attributable to about the company’s debt. Amid talks with lenders, Omnia said in April that “there is no requirement for any unscheduled repayment or recapitalisation”.
At the time it was optimistic that it would reach “an amicable solution” with its funders. It said the debt package would be presented to investors at the release of the firm’s full year results on June 25.