Old Mutual announced on Tuesday that it plans to fire Chief Executive Officer Peter Moyo after suspending him due to a conflict of interest.
The board gave Moyo a "notice of termination of employment" and will "shortly" start the process to find his replacement, the insurer said in a statement. Chief Operations Officer Iain Williamson will continue as acting CEO. Moyo declined to comment when contacted by phone.
Old Mutual suspended Moyo last month to investigate a conflict involving his investment firm NMT Capital. It found a breach of dividend payments of R115m, of which the benefit to Moyo's NMT was about R31m, Old Mutual said. No clear explanation was given on why the payments were declared outside of the insurer's policies.
"The board came to the conclusion that there was a material breakdown in trust and confidence," it said.
Old Mutual's shares rose as much as 2.3% to 22.19 rand in Johannesburg.
Old Mutual CEO in no mood to go quietly
The action "deals with some of the uncertainty around Moyo's suspension and that's the most crucial part of this," Warwick Bam, head of research at Avior Capital Markets said by phone. "There may still be a court case and some uncertainty around this, but it sounds like there have been further circumstances that have occurred beyond the suspension that have added to the concerns."
This isn't the first time the 56-year-old has featured in boardroom battles. Moyo, who trained as a chartered accountant at KPMG in Zimbabwe, joined Old Mutual in 1997 before becoming head of Alexander Forbes Group Holdings in 2005.
He quit two years later after clashing with the board. In 2016, while chairman at Vodacom Group, Moyo tried to buy a stake in the mobile phone company through NMT, before the deal was scuppered.
When Moyo was appointed CEO in 2017, Old Mutual set up a protocol regarding an earlier R291m investment made by the insurer in Moyo's NMT. The company, founded by Moyo and two others, has investments in construction, energy and financial services.
Old Mutual's board felt that the relationship had "become unmanageable and untenable" as they tried to effectively navigate through appropriate disclosure and conflict-of-interest policies, chairperson Trevor Manuel said on May 25.