STEPHEN VAN COLLER: EOH survives annus horribilis as it claws its way out of a graft hole

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After a torrid year in which Microsoft terminated its licence-reseller deal and governance breaches were unearthed, the company is on the up

When I joined EOH in September 2018, I was looking forward to growing its reputation as the leading provider of technology services on continent. I saw the enormous potential of leveraging the company’s entrepreneurial culture, the best technology brains in the industry as well as the unparalleled breadth of information technology solutions that allow for the creation of a “one-stop shop” for many clients.

Our democracy has been affected by the scourge of corruption, which has resulted in the poorest of the poor paying the highest price. As Africa’s largest information and communications technology company, and due to its systemic role in the SA economy, EOH is a business with tremendous potential. While we are not yet out of the woods, a year later we have made meaningful progress towards rebuilding a sustainable and well-governed group.

Very early on, several issues that were hindering the unlocking of value and sustainability became clear. EOH’s strategy was opaque to investors and other stakeholders. Due to an aggressive and confusing acquisition strategy, the mix of businesses was widely diverse and heavily weighted towards products rather than the sale of solutions and services. Alarmingly, in the later years this acquisition strategy was largely funded by imprudent levels of debt.

While the investigation was in full swing, we still managed to attract and bed down an experienced, King IV-compliant board and bring in an entirely new executive management team comprising talented individuals.Furthermore we initiated cost savings of more than R600m and collected more than R400m from long-outstanding debtors. This required pulling together as a team to understand the low-hanging fruit and having a particularly focused execution strategy.

 

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