EAPCC in spat with CMA over Lafarge appointment

East African Portland Cement Company (EAPCC) has gone to court, seeking to lift the suspension of its annual general meeting resolutions by the Capital Markets Authority (CMA), according to a report in Kenya’s Business Daily.

The company argues that the CMA lacks the mandate to suspend the resolutions since AGMs are overseen by the Registrar of Companies.

CMA suspended the resolutions by shareholders two weeks ago following a protest from the government, which is the majority shareholder.

The government argued that its voting rights were not acknowledged when EAPCC chairman Mark ole Karbolo adopted a show of hands, instead of number of shares held, to approve the day’s business.

The primary point of contention was the appointment of Didier Tresarrieu to represent Lafarge, the third largest principal shareholder, against the wishes of the government which wanted former CMC chief executive officer Bill Lay in the board.

In the papers filed in court, the government accuses French conglomerate Lafarge of compromising some of the State appointees in a bid to control the board through the backdoor.

The Treasury and NSSF jointly own 52 per cent while Lafarge owns 42 per cent, leaving six per cent in the hands of minority shareholders.

On Monday, High Court Judge George Odunga ordered that the status quo be maintained and directed the parties to respond by January 15 when the case will be heard.

CMA launched investigations into claims of creative accounting and breach of corporate governance rules during the EAPCC’s AGM on December 17 following protests from the Treasury and the NSSF.