A recent Industrial Relations Court (IRC) ruling has shed light on potentially questionable financial dealings at Press Corporation Limited (PCL). The case, involving PCL and three former executives, has raised concerns about “suspicious payments” made by the conglomerate.
According to a shareholder, a thorough review of the ruling revealed potential wrongdoing. “We will need answers during our AGM this year because the ruling has unearthed things we did not know about. We would like to know how the three bosses were fired unfairly and why we are losing K14 billion of our money while the people who made the decision are still enjoying benefits at PCL,” said the Shareholder who pleaded for anonymity until the day of the AGM.
In the case, former Group Chief Executive Officer George Partridge, Former Group Financial Controller Elizabeth Mafeni and former Group Administrative Executive and General Counsel Benard Ndau sued the conglomerate for unfair dismissal through the IRC, which ruled in their favour before the trio sued again for compensation for unfair dismissal in May 2022.
The three lodged a whopping K33 billion compensation claim, but the court awarded them a total of K14 billion on April 25, 2025. PCL applied to the court for a stay of execution of the order of compensation, citing a negative cashflow projection which could reach K21 billion by December this year, according to testimony of PCL’s Chief Finance and Administration Executive and Company Secretary, Moureen Mbeye.
IRC Deputy Chairperson Tamanda Nyimba allowed the stay of execution on condition that PCL pays 70% of the awards to the three, which translates to K9.7 billion. Two weeks ago, PCL published its financial highlights in the press, where it announced a whopping K122 billion profit after tax in the financial year ending 31 December 2024.
Going through the ruling, Nyimba wondered with assertions that the financial health of PCL is critically strained with significant liabilities and negative cash flow projections.
“In a nutshell, through the affidavit evidence of Ms Mbeye, the respondent has painted a gloomy picture of its financial position with a cash position that is projected to be negative for the rest of the year and an estimated December 2025 negative cash balance of MK7.4 billion before taking into account the sums awarded to the applicants. The respondent says the figure of K7.4 billion is expected to swell to MK21.5 billion if the applicants’ global award of compensation is factored in for immediate payment.
“Ms Mbeye went on to draw this Court’s attention to the respondent’s unavoidable commitments (over and above its normal operational requirements) namely a payment of MK1,147,300,000 disbursed to National Bank of Malawi plc (a subsidiary of the respondent) on 30th April 2025 in respect of a loan extended to Open Connect Limited (also a subsidiary of the respondent) in which transaction the respondent acted as a guarantor and where National Bank of Malawi plc proceeded to demand payment from the respondent upon Open Connect Limited’s debt becoming delinquent and an obligation taken by the respondent to capitalise Telekom Networks Malawi plc (equally a subsidiary of the respondent) by injecting equity amounting to MK16.4 billion,” said Nyimba in his ruling.
Nyimba further said the respondent is unconscionably continuing to bury its corporate head in the sand, as it were, about the consequences of its actions when it unfairly dismissed the applicants hence the visible absence in Ms Mbeye’s two affidavits of any hint regarding how or when the respondent plans to pay the applicants’ awards of compensation.
“If the respondent’s two affidavits in support of the instant application are anything to go by, the respondent seems to be in denial respecting this Court’s decisions finding it liable for the applicants’ unfair dismissal and the compensation thereof, while it relentlessly highlights its present tight financial spot,” added Nyimba.
Nyimba pointed out a striking contrast in Press Corporation Limited’s (PCL) financial actions. Despite claiming its coffers were “essentially empty,” PCL made substantial payments to various entities.
According to Nyimba, “While the respondent has passionately pleaded before this Court that its coffers are essentially empty, the respondent readily made the following payments.” These payments included $504,000 to Liberia Merchant Capital Limited for a 10% shareholding, $260,000 to Fortesa International Inc. for hydrocarbon exploration, and $6.7 million to Press Energy Limited for equity contribution.
Additionally, PCL transferred MK4 billion to its subsidiary Telekom Networks Malawi plc and MK1.147 billion to National Bank of Malawi plc for a loan guarantee. Nyimba noted that these disbursements were made while PCL was aware of a potential MK33 billion compensation award for unfair dismissal.
Notably, the MK1.147 billion disbursement to National Bank was made just five days after the court’s order on assessment. Nyimba also highlighted PCL’s imminent obligation to inject MK16.4 billion into Telekom Networks Malawi plc.
“Honestly, how can a Court grant a complete stay of execution in light of the foregoing flurry of expenditures? These very payments prompted the applicants to submit that it is almost like the respondent is saying it has finances available, but the said money is exclusively good enough for the respondent’s further investments into its various business ventures, as opposed to paying the applicants’ fruits of their litigation. That submission certainly has traction in the circumstances just laid bare. The respondent may easily be accused of corporate condescension,” ruled Nyimba.
He said even in its gloomy financial position, PCL has demonstrated that it can make certain substantial payments, but the three ex-bosses appear not to be in the contemplation of PCL or its priority. Nyimba also bashed PCL for its delaying tactics in the case.
Another case involving PCL and Rolf Patel over equity in Press Cane took 20 years in the courts before an amicable settlement was reached in October 2023.
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