Group demands removal of CMC’s managing director
Photo/FILE
CMC managing director, Bill Lay addresses journalists on September 14, 2011.
The boardroom wrangles at the motor dealer, CMC, took a new turn on Tuesday with the camp led by the ousted chairman calling for removal of the managing director and three other board directors.
Mr Peter Muthoka, through Andy Forwarders, the single largest shareholder of CMC, has called for Extra Ordinary General Meeting to seek shareholders’ approval to remove the four.
Those to be removed from office include Paul Wanderi Ndungu, Joe Kamau Kibe (current chairman), Andrew Hamilton and the company CEO William (Bill) Lay.
In their place, Mr Muthoka proposes Mark Ole Karbolo, Prof Francis Mwihuri Njeru and Peter Mbuthia Gachuhi, arguing that the current management has worked tirelessly to split the board.
The meeting will be held on November 21 at the Bomas of Kenya from 11.00 am. Mr Lay joined the company from the General Motors where he had worked for 36 years in the same position.
Mr Kibe, is the current chairman seen to represent the interests of Mr Ndungu and MobiCom. The entry of the two to the board saw the ouster of Martin Foster after 17 years at the helm in March 2011.
Mr Lay was then hired in June 2011. By then, GM was the largest player in the new vehicles market with 24 per cent market share followed by Toyota (23 per cent), Simba Colt (20 per cent) while CMC with 13.7 per cent sat in position four just ahead of DT Dobie (12 per cent).
Profit warning
In September, Mr Lay accused Andy Forwarders of inflating freight costs to CMC by between 10 per cent and 30 per cent and that two of the former CMC directors had stolen millions of shillings from the auto dealer and stacking it in off-shore accounts in Jersey Island.
Effectively the accusation resulted to the ouster of Mr Muthoka - the Andy Forwarder CEO, who had taken over as the chairman from Mr Jeremiah Kiereini.
Now the shoe is on the other foot with Andy Forwarders accusing Mr Lay and the other directors of mismanagement forcing “the company to issue a profit warning for the second consecutive year which is unprecedented in over 47 years of existence.”
The firm has been suspended from trading at the Nairobi Stock Exchange pending investigations.
