Dan Murphys owner Endeavour is ripe for a shake-up, but is the man who helped private equity make millions at Myer and Dick Smith the best person to deliver it?
Punch drunk from the pandemic, the country’s biggest bottle shops and pubs owner is wobbling around like it’s last drinks and time to go home.Usually-friendly sell-side analysts are running the numbers on drastic actions such as splitting up the company,Endeavour chief executive Steve Donohue.In the middle of it all, sitting there like loyal My Dan’s members not getting their promised cheap booze, are shareholders.
But Myer and Dick Smith are two stains in Australia’s listed markets and cast a long shadow over IPOs, and particularly floats from private equity hands. So, it makes for an intriguing battle. Myer and Dick Smith are still dirty words in listed markets – fund managers are happy for private equity and executives involved in their deals to make money, but not at their expense. They hate to think someone else squeezed the lemon and sold the market a pup.
Wavish fronted up to the hearings. He explained his hands-on role putting together the Dick Smith management team and business case for its private equity backers, including a focus on stock, supplier terms and rebates. Those rebates and how they affected decisions on what was on shelves in Dick Smith stores was aWavish was cleared of any wrongdoing, as were the other directors, and had his legal costs paid.
Whether those retail investors listen to him or Endeavour’s board and chairman is another matter. They normally side with the board, which turns proxy fights into a battle of institutional investors.The first is shareholders’ desire to turn around Endeavour’s performance. You could sense the disappointment among analysts and fund managers in August, when Endeavour handed down a $529 million profit after tax.
Wavish landed with a splash last week. He says he bought about $500,000 worth of stock eight weeks ago and wants to help get the share price to $10 – “ten dollar Bill”, as he puts it. Endeavour shares finished last week at $5.27.Endeavour’s board, and most importantly chairman Peter Hearl, is trying to keep him out. They’re playing for time, telling shareholders last week they didn’t have enough time to properly vet Wavish ahead of the October 31 annual meeting.
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