ELEMENTONE'S directors have demanded that the commission paid to Caxton chief executive Terry Moolman, his long-term business partner and some directors and representatives be scrapped, writes Thabiso Mochiko in Business Report.
The mood was tense at Caxton's annual general meeting when the ElementOne directors also asked the company to disclose the beneficiaries of its investment share scheme.
Caxton's majority shareholder and founder Moolman, managing director Gordon Utian and Chris Booysen are paid a combined 2.5 percent of the total net advertising revenue each year as commission.
In the year to June, revenue for newspapers, printing and distribution was R3.92 billion. Total revenue was R4.03bn.
The agreement to pay Moolman and other directors commission dates back to Caxton's formation in 1977. The board reapproved the agreement in 2002. The contract, which carries a two-year termination notice, will remain as long as Moolman controls Caxton.
Danie Vlok, representing ElementOne, questioned the rationale for continuing to pay the commission, especially since Moolman was the chief executive, was drawing a "market-related salary" and was the majority shareholder. "It's in the best interest of the company to terminate the contract."
ElementOne spun off its other media and entertainment businesses, such as the Sunday Times and Nu Metro, into Avusa and now owns only a 33.6 percent stake in Caxton.
ElementOne's attorney, Lourens van Staden, questioned how the amount of the commission was essentially unchanged from the previous year.
Caxton's acting chairman, Phillip Vallet, defended Moolman, whom he described as having provided strategic guidance to the group, which had grown under his leadership into a multibillion-rand company.
The board had discussed the commissions and, according to Vallet, was unanimous that it was in the best interest not to terminate the contract.
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