EOH dives 22% as possible Microsoft divorce goes to court
CEO Stephen van Coller has called on anyone with knowledge of past unethical business practices to come forward
EOH's share price fell 22% to R15.20 on Monday morning after the company issued a statement indicating its relationship with Microsoft was heading to court.
The JSE-listed computer group fell 26% on February 12 when it issued a statement saying Microsoft had given it 30 days' notice that it intended to terminate its channel partner agreement with its subsidiary, EOH Mthombo.
It then rebounded 15% on Friday after saying: “Together with Microsoft, EOH is working to better understand the concerns and rationale for the action. Following a recent fruitful meeting between the EOH and Microsoft leadership, Microsoft has advised that it is taking the EOH proposals under consideration and further review.”
In Monday's statement, EOH said the “this matter is now sub judice”, indicating discussions with the US software giant did not go amicably.
Microsoft has still not officially provided EOH with any confirmation for the reasons for the notice, it said.
“I again encourage anyone who has evidence to please come forward so we can root out any historical unethical business practices both within EOH and the broader country,” CEO Stephen van Coller said in Monday's statement.
“As part of our current processes, ENS reviews about eight to 10 bids per week.”