ANNUAL MEETINGS : Mobil Shareholders Reject Call to End S. Africa Sales

Although Mobil recently decided to sell its operations in South Africa, some stockholders at the company’s annual meeting Thursday complained that it has not done enough to sever ties with the white-ruled nation.

While they applauded the sales, representatives of religious groups and an official of New York City’s pension fund pressed unsuccessfully for resolutions that would cut Mobil’s indirect economic ties with South Africa and end sales of its petroleum products there.

“If Mobil is pulling out of South Africa, then let it be a clean break,” said Kenneth Sylvester, director of Investment Responsibility for New York’s office of the comptroller.

Mobil announced two weeks ago that it was selling its South African unit to General Mining Union Corp. for $150 million in cash, ending its role as the largest U.S. employer in South Africa.

Tax Bite, Loss Cited

Mobil Chairman Allen Murray said a punitive U.S. tax law aimed at discouraging investment in South Africa had resulted, in effect, in 72% taxation. The sale will result in a book loss of $140 million.

Mobil had long contended that its continued presence in South Africa would do more to combat apartheid than its leaving the country, and Murray voiced that sentiment again Thursday.

“We remain proud of what Mobil people have accomplished in South Africa in their contributions to economic and social programs for nonwhites,” he said.

Murray recommended that stockholders vote against the resolutions proposed by the activists, and his advice was largely heeded. Only 14.3% of Mobil’s shares were voted in support of a resolution to sever all economic ties with South Africa, while 15.5% were voted to end all petroleum sales to South Africa’s government.

Pressed by the activists, Murray said Mobil’s trademark could be used by Gencorp for as long as five years.

The activists also said Mobil had broken a promise to consult with its local workers before the sale of the unit was arranged. Murray said that the workers will enjoy the same benefits Mobil had provided, and he added that Gencorp has promised not to lay off anyone for at least one year.

Personnel Arrangements

Mobil has a staff of about 2,800 in South Africa, all but two of whom will remain there after the sale is completed in June.

“An honest exchange of disagreement,” Barbara Aires of the Sisters of Charity of Saint Elizabeth said after the meeting. She was one of a group who repeatedly questioned Murray about the terms of the sale and about Mobil’s indirect ties with South Africa.

The activists said they were asking Mobil to do more because its earlier announcement was so significant.

“It will set a precedent in terms of remaining indirect ties and in terms of consultation with local workers about divestment,” said Donna Katzin, speaking for the Interfaith Center on Corporate Responsibility.

One Company Remains

Caltex Petroleum Corp, a joint venture of Chevron and Texaco, is the sole remaining U.S. oil company doing business in South Africa.

In Cape Town, Jock McKenzie, chairman of Caltex Oil SA, said his company had no intention of leaving South Africa.

He dismissed speculation that Caltex would follow the lead of Mobil and noted in a statement that motions calling for the withdrawal of Texaco and Chevron were overwhelmingly defeated in recent annual meetings of both companies.

Since 1985, more than 170 U.S. companies have left South Africa under pressure from anti-apartheid groups.