Gillon McLachlan named Tabcorp boss for ‘transformation’ journey
Ex-AFL chief executive Gillon McLachlan will take up the job at the wagering giant on August 5, and has a big job to turn the business around.
New Tabcorp chief executive Gillon McLachlan will go from running the biggest sport in the country to an embattled ASX-listed organisation that needs rebooting and turning around, but insists he is up for the “challenge and complexity” of the role – his first major appointment after two decades at the AFL.
Mr McLachlan, whose role was announced on Monday morning after being foreshadowed by The Australian last week, also said he would maintain his new advisory role at Crown Resorts owner Blackstone but stressed: “I am 100 per cent focused on Tabcorp, and it will not be an issue.”
He said Tabcorp “is a complicated business in the middle of transformation … with some big decisions to be made” but one that has “a lot of opportunities” for growth.
The move comes as Tabcorp grapples with softening trading conditions, as cost of living issues has caused punters to bet less regularly in the past year.
“I’ve been drawn to the challenge and complexity of the job. It is a sports, racing and entertainment business with a legacy brand and a diverse brand across its core wagering product, a broadcast business, 3800 retail outlets, an integrity service businesses and state licences,” Mr McLachlan told The Australian.
“It is a business undergoing a digital transformation journey searching for growth. I believe I understand racing and sport, and consumer spending as well, and so for me this is a great leadership challenge. I am very aware of the challenge of this role, and I embrace that.”
Mr McLachlan will join Tabcorp on August 5, subject to regulatory approvals, but will be an observer to the executive chairman in the interim. He joins on a starting annual remuneration package of $1.5m, including super, and will be eligible for short and long-term incentives that could be worth several million dollars more.
“Tabcorp is part way through its transformation journey, and I’m looking forward to working with the leadership team to accelerate and deliver on the growth opportunities,” he said.
Mr McLachlan is taking over from Adam Rytenskild, who was sacked in March for allegedly making a sexually charged comment about Victoria’s top gambling regulator. Mr McLachlan left the AFL at the end of last season after a decade as CEO and having joined the sport’s head office in 2000.
Mr McLachlan would not comment directly on Mr Rytenskild, but said: “I come with a belief that in the end a business is defined by their people and culture. I will not make any comment on any specific cultural issues at Tabcorp other than to say that people and culture are a determining factor regarding the success of an organisation.”
Rumours of the move for Mr McLachlan pushed Tabcorp’s share price up about 10 per cent on Friday, but the stock is down 21 per cent this year. It ended steady at 66c on Monday, after falling slightly during trading earlier in the day.
“This is an Australian brand that talks to racing and sport, and it has a great asset in the media business (Sky Racing) that I am keen to work on exploring its potential with the team here and others, and look at what we can do both here domestically and internationally,” Mr McLachlan said when asked about potential growth within Tabcorp and its various business arms.
“It is a big and diverse business with a lot of opportunities.”
Mr McLachlan said he had discussed the Tabcorp job “over months, not just weeks” and said if “there was any conflict [regarding Blackstone] I would have to stand aside from that. But it is a non-executive ambassadorial role that has been signed off, and it will not impede me at Tabcorp. I have been transparent about it.”
He also received the backing of a key stakeholder in Peter V’landys, the CEO of Racing NSW and a past critic of Tabcorp management.
“Gill is a very smart operator, and a brilliant dealmaker. I think he will do an excellent job, I really do. And If I didn’t think that, I would say so,” Mr V’landys told The Australian.
“He has got the ability to be a great success in the role. He did a brilliant job at the AFL, if he can replicate that at Tabcorp, then Tabcorp shareholders will be the winners.”
Mr McLachlan said he would work hard on building stronger relationships with various Tabcorp stakeholders, including Racing NSW.
Tabcorp chairman Bruce Akhurst also backed Mr McLachlan’s acumen.
“Gill needs no introduction – he is recognised as one of Australia’s leading CEOs, and securing Gill is a great vote of confidence for Tabcorp’s future. We’ve laid strong foundations and Gill brings a growth mindset and the capability to capitalise on the opportunities ahead of us,” Mr Akhurst said in a statement to the ASX.
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