KDN's Johan Badenhorst and Atul Chatulverdi

There are media reports that Altech had fired 8 senior management at KDN including the CEO. It seems that the media organisations picked the news from Moneyweb Online publication which quoted Altech CEO as saying that they will have a new CEO in Kenya by October 15th.

Well, I have just spoken with Tim Ellis who is Altech who is Altech Group Executive in-charge of Converged Services. Tim says “Altech has not fired anyone in its East African regional operations or Kenya for that matter”. Tim says that the company is only reconstituting its management both in South Africa and Kenya and the announcements will be made before the end of October.

Tim confirmed that oversees the East Africa operations in his current position.

I asked Tim if he understand the concern of the KDN employees well intimating to him that many have complained of how the Altech group senior management views the Kenyans. Tim said “Altech understand the concerns well and changes will be reflected in the announcements to be made soon”

Altech has replaced more senior managers in Kenya with South Africans most of the time even going against the country’s labour laws. This was more evident when Altech decided to appoint from Essar Kenya CEO, Atul Chatulverdi, the Chief Marketing and Commercial Officer replacing two Kenyans. Kenya immigration laws demands that posts like Marketing be held by locals. The new foreign (mostly South Africans) management seems not to understand the Kenyan market well with their attitude which does not accommodate the Kenyan team.

“How do you expect someone who was brought up disrespecting indigenous Africans up to his 20’s and 30’s to respect black Kenyans or even sell to them a product? It is hard since they already have a discriminating attitude against his/her potential client” a credible source who formerly worked with KDN posed referring to the many complaints of racial discrimination by the Senior Management assigned from South Africa. Many of the Altech South Africa seconded employees are in their 40s and 50s while the oldest Kenyan at KDN is just in not so late 30s.

“Sometimes it is even hard to invite these Altech SA assigned managers for a drink since when you do so, they would rather go and drink with white colleagues elsewhere and not some black Kenyan or African. The people they look down upon as inferior are the ones who used to deliver to KDN mega profits. Altech is just chaos” he added saying that even the team mentality has been hard to build in the Altech EA operations since already there are concerns with attitude of the existing staff.

It seems though that up to around 8 senior managers at Altech East Africa operations headed by Rikus Matthyser being sent home. A new team led by Jeffrey Hedberg will start taking over the EA operations management from 15th October. But with Tim Ellis contradicting his CEO as quoted in the South African press, it seems that Altech does not want to affect the market mood with already the fiasco at KDN affecting the performance of its stock in JSE.

Craig Venter, Altech CEO told ITNewsAfrica that “it has taken the company long to instill business culture in its East Africa operations”. Some of the KDN staff we spoke to wonder which business culture CraignVenter is talking of when the same culture East African handlers had brought profits to KDN until when it started assigning managers with no team spirit at all.

ItNewsAfrica report reads;

The Altech Group CEO, Craig Venter, indicates that all other 33 Altech operating companies performed well out of the 34 operating companies, with Kenya being the exception.

Altech East Africa operations has not broken even with the firm now threatened with being closure should it fail to deposit Ksh 400 Million in a joint account with Telemec Soliton.

The cable infrastructure engineering firm Soliton Telemec is demanding Ksh678 million from KDN for laying the inland fibre optic cable from Thika through Garissa to Mombasa in 2007. KDN is claiming that it has been invoiced higher than agreed saying that it only paid part of the correctly invoiced amount.

Altech owns 60.8% of KDN having increased their initial stake from 51% by acquiring 9% more.

What do you think of the KDN debacle?

  • Ron

    The KDN fiasco is part of a bigger trend where a South African brand has floundered in the Kenyan market. It seems that the managers they ‘import’ are not up to scratch at all. They probably consider Nairobi a hardship post – like a transfer to Moyale – and consequently act the part. Interesting enough, the only JSE listed company that did well here (Standard Bank) avoided this by merging with a Kenyan firm (CfC) that probably understood the local context better. All said, the winners are KDN’s competition and the losers, as usual, are the Kenyan employees and consumers.