Is Scangroup honcho Thakrar on way out?

For decades, Bharat Thakrar hobnobbed with the country’s leading corporate bosses as he built his company, Scangroup that became East Africa’s largest integrated marketing communications firm after global communications firm WPP acquired the majority stake.

Yet, in a flash, the reputation he has built over nearly four decades was put on the line on Friday after the board of WPP-Scangroup announced his suspension alongside the Chief Finance Officer, Mr Satyabrata Das over allegations of gross misconduct and “possible offences in their capacity as senior executives and employees of the company.”

Details of the allegations against Mr Thakrar and Mr Das remain scanty, but there have been still-unproven allegations of diversion of funds and business through dubious companies as well as allegations of insider trading. A flamboyant multi-media executive has been caught in the alleged scheme, and the board on Friday announced that investigations into the claims were underway.

In an interview with the Sunday Nation, board chairman Richard Omwela said they are hoping for “a quick, fair and transparent investigation to be done for the sake of all stakeholders involved and clients as well”.

Speculations

 “It is going to be a very short process, but the two must be given an opportunity to give their version of events,” said Mr Omwela. He, however, declined to delve into the details of the accusations against Mr Thakrar and Mr Das.

 “There are all sorts of speculations, hence the reason to try and carry out a thoroughly fair investigation. The real reason will come out and it is unfair for me to divulge anything at this time. They both have been furnished, in writing, with the reasons so that they can defend themselves,” said Mr Omwela.

Mr Thakrar, regarded and celebrated for years as one of the country’s foremost public relations practitioners, did not respond to our calls and text messages for his side of the story.

Following the announcement of the suspension and the accompanying caution on trading on the firm’s shares, the stock price of WPP-Scangroup plummeted, by more than seven percentage points. It closed the day at Sh5.94 a share.

 “In the short term this will have an effect on the share price and under the rules, if the price goes to below a certain number then CMA (Capital Markets Authority) can suspend trading to safeguard shareholders. This is a CMA decision,” said Mr Omwela.

Mr Thakrar founded the company in 1982 but gave up the majority stake when WPP acquired a 50.1 per cent stake in 2013 at a cost of Sh1.8 billion. WPP upped its stake to 56.25 per cent in 2018. Now Mr Thakrar finds himself an unwanted person in the company he helped found.

Under his stewardship, WPP-Scangroup has been a dominant player in the integrated marketing communications field, having under its wings big corporations like Safaricom, Coca-Cola, and Huawei,.

Under WPP-Scangroup are ten different businesses that cover advertising, digital business transformation, public relations, media strategy and trading.

Scangroup has been on the spot after a number of its big-money contracts with State corporations and public agencies were questioned. None of these claims, however, have been proven.

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