Mobily CEO suspended pending investigation
Khalid al-Kaf's deputy, Serkan Okandan, will temporarily be put in charge of the company
Saudi operator Mobily has suspended its CEO, Khalid al-Kaf, pending an investigation into accounting errors that forced one of its parent companies, Etisalat, to amend its profit statements, according to a Reuters report.
Etisalat has a 27.5% stake in Mobily, which announced last month that it would amend financial statements from January 2013 to the end of June 2014, cutting profits by a total of AED 1.43bn ($381.2m).
Kaf's deputy, Serkan Okandan, will temporarily be put in charge of the company, the Reuters report said. Okandan will maintain the top position until Mobily's audit committee completes its investigation.
Kaf is the longest-serving CEO in the Gulf telecoms sector, having taken over at Mobily in 2005. Okandan, meanwhile, was made deputy CEO after being Etisalat's CFO.
According to Reuters, Mobily's share price has fallen by 36% in the past two months, following rumours that the company's results were not what they seemed. The news organisation calculated that this had wiped out SAR 6.56bn from Etisalat's stake in the company.
Etisalat's adjustment to reported post-deductions profits, which will be issued in its Q4 statement, includes AED 130m cut from 2013 and AED3 2m from the first three quarters of this year, for a combined AED 162m ($44m).
Etisalat had reported net profit of AED 7.08bn in 2013, AED 1.18bn (16.7%) of which was attributed to Mobily.