Pinnacle CEO and investors rally round

2014-03-30 14:00

After a tumultuous week in which the company lost nearly half of its market value on the JSE in two days, the CEO of tech company Pinnacle and his family members climbed in on Thursday and bought shares worth millions.

The company’s share price fell by more than 40% on Tuesday and Wednesday after the arrest of its director, Takalani Tshivhase, was reported.

A day later, the Arnold Fourie Family Trust bought a million shares at an average price of R13.21 in 30 transactions. On the same day, the Louis Fourie Trust purchased 160?000 shares at an average price of R12.50 a share.

On Wednesday, the Elandre Fourie Trust bought 300?000 shares at an average price of R12.11 a share. Louis and Elandre are Fourie’s brothers.

The company said in a Stock Exchange News Service announcement on Tuesday that Tshivhase, an executive director, had been arrested by the police’s anti-corruption unit on March 5.

He allegedly tried to bribe a lieutenant general in the SA Police Service with R5?million to clinch a multimillion-rand contract for the company.

With the announcement of this news, Pinnacle’s share price plunged 25% and a further 23% the next day after the JSE said it would conduct an inquiry into Pinnacle Holdings’ affairs.

The story has raised some concerns, including the fact that the company only informed the market two weeks after the arrest and that Tshivhase sold R4?million worth of shares just days before the news of his arrest became known.

According to Pinnacle, following legal advice, the announcement was made immediately after a formal charge had been laid against Tshivhase.

Pinnacle says Tshivhase applied for leave of absence until the case is concluded and this was granted.

His case has been postponed to April 24 for further investigation.

Tshivhase denies all allegations of bribery and will oppose the charges against him.

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