Bloomberg News

Cipla Medpro’s Former CEO Sues Company in Labor Court Case

January 08, 2013

Cipla Medpro South Africa Ltd. (CMP), the country’s third-largest drugmaker, said it is opposing a lawsuit from former Chief Executive Officer Jerome Smith which alleges his employment contract was ended unlawfully.

Smith claims about 18 million rand ($2.1 million) for the repudiation of his fixed-term contract and more than 11 million rand for unpaid bonuses, the company said in a regulatory filing after the close of the Johannesburg Stock Exchange.

Cipla “will oppose the proceedings” in the Labour Court, the company said.

Smith, who was CEO of the Johannesburg-based company for almost five years, resigned on Oct. 8 before the start of a disciplinary meeting into more than 20 charges, including gross misconduct. The Takeover Regulation Panel probed the company after shareholders, including Smith, lodged a complaint. The regulator dropped its investigation, Cipla said today.

The company’s stock has risen 26 percent since Smith’s resignation and closed at 9 rand in Johannesburg. The four- company FTSE/JSE Africa Pharmaceuticals and Biotechnology Index advanced 17 percent over the same period.

To contact the reporter on this story: Jaco Visser in Johannesburg at avisser3@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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