Denel Group CEO suddenly resigns
State-owned defence industrial group Denel announced on Monday that its Group CEO, Danie du Toit, had resigned. Although the group is the country’s largest defence company, it is in severe financial difficulties.
Denel stated that Du Toit would leave the organisation on August 15. It gave no reason for his departure. It further gave the assurance that an interim Group CEO would soon be appointed.
The financial state of the group is so parlous that it has been having difficulty in paying the salaries of its employees. Last month, the Solidarity trade union highlighted that some Denel workers had only received 20% of their pay in May.
Not only that, but Denel had also been unable to pay employees’ income tax and other statutory deductions to third parties since April. Further, it had indicated to the union that future staff salaries were also at risk and had proposed that its workers should give up part of their salaries for June, July and August.
Denel had a turnaround plan, and the group’s management had told the union that the government supported the plan. But the State had not provided the funding required to implement the plan.
“Denel remains an innovative defence, security and related technology solutions company, providing solutions of defence, security and related technologies, to clients both domestic and international,” affirmed the group in its press release announcing Du Toit’s resignation. “The turnaround plan is focusing on protecting promising business lines, disposing of non-core assets, and seeking strategic partners to increase access to international markets, contribute skills and funding to a profitable Denel. The Board has taken far-reaching steps to stabilise the business and prepare the ground for Denel’s long-term sustainability.”
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