Corporate cop eyes WiseTech as billionaire White retakes control

The successful boardroom coup by WiseTech’s disgraced billionaire founder Richard White could be in jeopardy after the corporate watchdog announced it was looking into the actions of the software giant.

White was on Wednesday elevated to executive chairman of the $32 billion tech giant WiseTech, which is in turmoil after four independent directors quit earlier this week citing “intractable differences” between them and White over his ongoing role with the company.

WiseTech Global’s founder Richard White says he’s here for the long haul after taking on the role of executive chairman.Credit: Bloomberg

But as the company sought to calm investors’ nerves over the boardroom implosion, the chair of the Australian Securities and Investments Commission, Joe Longo, said the regulator was making early inquiries.

“We are conducting preliminary inquiries and will be making decisions imminently about any next steps,” Longo said.

He acknowledged conduct reported by the Sydney Morning Herald, the Australian Financial Review and The Age had triggered the regulator’s interest, including White’s $200 million share sell-off during a trading blackout and the failure to release an independent report into multiple allegations of inappropriate conduct by White.

On Monday, WiseTech’s four independent directors, including former chair Richard Dammery, dropped a bombshell when they announced they were leaving the board due to “intractable differences in the board and differing views around the ongoing role” of White.

One of the key flashpoints between the directors and White was understood to be the release of the independent report into further allegations of inappropriate conduct against White made by an employee and a contractor.

WiseTech had engaged two law firms, Herbert Smith Freehills and Seyfarth Shaw, to investigate some of the allegations.

The boardroom purge triggered a 20 per cent collapse in its share price on Monday.

On Wednesday, White, who owns 37 per cent of WiseTech, was appointed executive chairman of the tech giant having been forced to stand down as chief executive in October last year following allegations of inappropriate conduct.

The exodus leaves WiseTech’s board in the hands of three directors with long-term loyalties to White, including Mike Gregg, who rejoins the board today and will handle the report into allegations against White.

WiseTech said in its earnings release that an update on the status of a report into White’s conduct would be provided to the market next month.

The director resignations are effective as of Wednesday, after the board signed off on the company’s half-year accounts, but WiseTech confirmed that it was now in breach of ASX listing rules requiring its audit and risk committee have at least three non-executive directors.

The company said it intends to recruit additional non-executive directors as soon as practicable.

Meanwhile, on a conference call for the company’s half-year results on Wednesday, White attempted to calm investor nerves.

“I want to let you know that I’m fully engaged and here for the long haul,” White told analysts and investors.

But he also had a blunt message for his critics: Customers couldn’t care less.

“[They] don’t think about this market or these governance issues in Australia,” he said. “They think about what is right for them, for their product, for their business, and for the long term of WiseTech as it affects that business … time and time again, that comes across very clearly.”

The head of portfolio management at WiseTech investor HESTA, Jeff Brunton, said there was “significant work ahead for WiseTech to restore investor confidence”.

“This includes the return of a majority, genuinely independent board, the delivery of a clear succession plan, and substantive disclosure of key findings from the board-commissioned reviews alongside proposed actions to safeguard a strong and respectful culture,” he said, adding that HESTA would engage with the company.

Corporate governance expert Helen Bird said the catastrophic board purge creates problems for investors.

“If you’re an investor in [WiseTech] … you should look at this with some horror because there have been clear issues going on there, and he’s taking control,” she said in an interview with Bloomberg.

While she described White as the “magic and the brains” behind WiseTech’s success, she said no fund manager was going to be happy with what’s happening. “I wouldn’t say this is over by any stretch.”

White’s re-appointment failed to convince the market that the company’s woes are behind it. The shares were still down more than 20 per cent since last week.

White has been fending off damning allegations of inappropriate behaviour for months. One woman dubbed him the “LinkedIn Lecher” due to his alleged propensity to approach women via the network to offer business advice in return for sex. White has denied the claims.

WiseTech unveiled another booming half-year result on Wednesday, with total revenue up 17 per cent at $US327 million ($515 million), net profit rising 38 per cent to $US77.1 million and cash flow of more than $US100 million.

But the logistics group put caveats on its growth outlook for the first time as clouds grow over international trade due to US President Donald Trump’s mounting trade war.

“[Earnings forecasts for financial year 2025 are] provided on the basis that market conditions do not materially change … noting that changes in industrial production and/or global trade (both favourable and unfavorable) may impact guidance,” it said.

WiseTech offers logistics companies a cloud-based platform to manage all of their global operations across different jurisdictions, languages and customs regulations.

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