Is Dan Murphy’s ready for the Jayne Hrdlicka experience?

The former Virgin Australia boss is known for her take-no-prisoners management style, but will this celebrity CEO have the freedom she needs to revive the liquor retailer?

Former Virgin Australia CEO Jayne Hrdlicka is heading to Endeavour Group.

Where boards have been cooling on celebrity CEOs, the $8bn Dan Murphy’s and pubs owner Endeavour has bucked the trend and called on former Virgin boss Jayne Hrdlicka to snap it out of its funk.

But in doing so, two questions come to mind. Is the Bain consultant-turned-airline boss the right fit? And, more importantly, is Endeavour ready for Hrdlicka?

It’s been an endless search following long-serving boss Steve Donohue bowing out.

Hrdlicka doesn’t intend to start until January as she steers her youngest son through the final year of high school.

She will be available for meetings and consulting with the board during this period, but it is an usually long wait for a new CEO to join a company which has been drifting.

It also brings into the equation whether Hrdlicka intends to make another run as the high-profile Tennis Australia chair when her third term ends later this year. She has held the spot since 2017 and requires board support to extend her tenure. It is understood this won’t be easy as there’s a mood for change inside the top sports body.

Endeavour will rightly want its new CEO on the ground during January – one of its biggest retailing months, which also coincides with the Australian Open. Chairing is a full-time gig through several weeks of the grand slam, and tennis obsessed Hrdlicka throws everything at it.

Endeavour Group has named ex-Virgin Australia chief Jayne Hrdlicka as its new chief executive.

The extended window before starting underscores the determination of Endeavour executive chair Ari Mervis to lock Hrdlicka into the top role, particularly with others – including former Woolworths CFO David Marr – understood to have been considered for the job.

That means Mervis will be running the company for the next eight months, essentially putting Endeavour on strategic hold until Hrdlicka takes charge.

Mervis, a former Foster’s chief executive and one-time Murray Goulburn boss, has the experience, although Endeavour really needs a dose of longer-term strategy.

On this, the incoming chief has her work cut out. Dan Murphy’s has been likened to the Bunnings of bottle shops, but it has lost its mojo since Endeavour was spun out of Woolworths four years ago.

Sales at Dan Murphy’s and discount chain BWS dropped 2 per cent in the most recent half.

Then she faces the structural headwinds of a younger generation turning off alcohol, and tough rules around cashless gaming – particularly in Victoria – keeping punters at bay.

A new generation less wiling to drink is one of many hurdles facing the new Endeavour boss.

The pubs business is resilient, but is low growth and requires heavy investment across a network of more than 350 pubs and clubs.

More recently, Endeavour has been acquiring a portfolio of wineries and is now up to six in total, including Yarra Valley’s up-market Oakridge.

This expansion represents a major strategic shift and ties up precious capital. It will be a big focus of Hrdlicka’s clean-up job.

Right fit?

This then leads to the question about whether Hrdlicka is the right fit. She is essentially joining a family-controlled business, with pubs king Bruce Mathieson sitting on a 15 per cent stake.

Remember, Mathieson was engaged in a public spat and agitated for the exit of Donahue. And as part of a peace deal, the family has a director on the board.

Importantly, Hrdlicka has the early blessing of the Mathiesons, with Bruce Mathieson Jr telling The Australian earlier on Tuesday he was “encouraged” by the appointment.

The family knows Hrdlicka from her time on the Woolworths board, when the Mathiesons were a joint venture partner with the supermarket operator.

However, the former airline boss comes with a ruthless, results-driven management style which has put many off-side in previous jobs. She has a reputation of ‘it’s her way or the highway’, and the main challenge will be whether Mervis gives her the freedom for the clean-up job.

As CEO of a2Milk, she left part-way through her tenure after clashing with the board. And while she rebuilt Virgin from administration, private equity owner Bain opted to not go with Hrdlicka through to a planned stockmarket listing.

However, in her more than 12-month workout period, Hrdlicka engineered a strategic coup that gave Virgin a much-needed international alliance and cornerstone shareholding with Qatar Airways. She also left an airline ready for an IPO.

Hrdlicka has talked up her time on the Woolworths board for six years until 2016 as giving her a good grounding for Endeavour. At Bain she worked with Woolworths on liquor strategy.

“I am delighted to be joining a company with such great brands, strong assets and opportunity yet to unlock,” Hrdlika says.

“The business has a portfolio of unrivalled positions in the Australian market and I am very optimistic about where we can take the future.”

Hrdlicka’s big personal challenge will be around keeping the Endeavour board and, most importantly, the Mathiesons, onside. It’s about bringing a clearer focus to the retailer and pubs play.

If she can do this, Endeavour will emerge on the other side as a very different business. Who knows? Dan Murphy’s might be able to shine again.

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Big bet

Betr’s Matt Tripp spent much of Tuesday talking up the hard cash behind his audacious $360m move on listed bookmaking rival PointsBet.

Tripp’s late-night raid on Monday of a 20 per cent stake of PointsBet shares is not yet enough to fully block a rival takeover deal already under way, but the Betr chairman is confident he still has an ace up his sleeve.

That comes down to the funding of the deal, and National Australia Bank has come to the table with a bigger-than-expected $120m debt facility. At the same time, Betr on Tuesday launched its much promised, fully underwritten $130m equity issue (including a $20m commitment from Tripp and his partners). As a final twist, Tripp has a $45m non-binding proposal to sell his Canadian customer book to a unit of casino operator Hard Rock.

It’s all aimed at spoiling the friendly $352m deal between PointsBet and Japan’s Mixi.

Tripp is calculating Mixi, a relative major in its own market but newcomer to Australia, doesn’t have the stomach for a contested bid against someone who is a pioneer of the local online bookmaking market.

Betr chairman Matt Tripp has promised to throw everything at PointsBet. Picture: Aaron Francis

The focus on the funding is designed to neutralise the key argument made by PointsBet’s board that Tripp’s Betr bid was built around smoke and mirrors.

It’s not a slam dunk. Not all the cash is in the bank, but makes it difficult for the PointsBet board to knock back Tripp again without some sort of engagement.

Part of Tripp’s bid contains a share component, which means he is still asking PointsBet’s shareholders to take a leap of faith that he can deliver on the promised $40m cost synergies. This stands to deliver $1.50 a share. Tripp is offering a lower all-cash option of $1.20 per share that still trumps the $1.06 cash Mixi has on the table. PointsBet’s board is considering the new offer.

Tripp is looking at the combination of Betr and PointsBet to get to the 10 per cent share of the Australian online bookmaking market. This would position him as the fourth-biggest player and a platform for further consolidation that he believes is coming in gaming.

Tripp’s intervention comes as PointsBet was about to send a scheme booklet and independent expert report to investors in coming weeks.

“All the concerns outlined by the PointsBet board about our bid are fully addressed, and we’re ready to go,” Tripp says. “We’ll throw everything at making this combination a great success”.