Language blue spells end for Tabcorp chief; Dubber mystery still no clearer

Adam Rytenskild’s utterances have been verified by witnesses, although he says it’s not the sort of language he'd use.

An ignominious end to the career of Tabcorp CEO Adam Rytenskild, who walked the plank on Thursday after the gambling company’s board voted unanimously to terminate him from the business.

Rytenskild was accused of deploying some “inappropriate and offensive language” in the workplace, according to a statement issued to the market after the close, language that was said to be “inconsistent” with his continued leadership of the organisation.

Pretty much everyone in town immediately wanted to know what was uttered, of course, and Margin Call is reliably informed that Rytenskild basically called someone a “useless c..t”, or words very close to that effect, in front of a number of people, not all of whom hail from inside the Tabcorp tent.

Another version of the incident is that Rytenskild made a sexually graphic remark about a female racing figure.

It has been suggested that the tone of the language was more like locker-room talk rather than anything said with venom or anger at anyone.

Anyway, the complaint lobbed internally within the last fortnight and saw Tabcorp swiftly engage external lawyers to report back on what transpired. The findings were said to be more than enough to force the end of Rytenskild’s tenure, the directors voting 7-0 in favour of termination. In the end, he wasn’t fired but quit, as the statement established.

David Gallop would have been exposed to some colourful turns of phrase at the NRL.

And you have to remember who’s on the Tabcorp board, too, guys like David Gallop, a fella who’s been around plenty of colourful language during his years as the NRL’s chief executive. If what Rytenskild said was enough to cause Gallop to bristle then you just know it was either very, very rude, or that we’re living in a very modern age (both of which can be true at the same time).

No surprise that it was somewhat easy to corroborate the remarks with witnesses, considering there were plenty, although Rytenskild said in a statement that he doesn’t remember what was actually said and generally doesn’t speak in those flourishes: “I don’t recall making the alleged comment and it’s not language I would usually use, but I have regrettably agreed to resign.”

Clearly the company means business when it says it “will not hesitate to take action” in upholding its standards of conduct. No golden parachute on the way out for Rytenskild; He’s in line for termination payments and that’s it, sayonara, not even a bite from the unvested shares and options, said to be worth up to $10m.

Tabcorp chair Bruce Akhurst will step in as executive chairman while the search for a replacement advances for a fresh MD and CEO. A shame, really, because from what Margin Call hears the board had been quite comfortable with the direction of Tabcorp under Rytenskild up until this point.

Dubber intrigue

Mystery persists over listed call recording outfit Dubber, which suspended its CEO Steve McGovern a fortnight ago over the millions of dollars that suddenly went missing from the company’s bank account.

Dubber shares were voluntarily suspended from the ASX soon after the discovery of a significant wrinkle in its figures during the prep for its half-year accounts. A preliminary investigation, it said, had uncovered funds in a term deposit “may have been applied for other purposes and are not currently available to the company”.

Truly bizarre this one. Some $30m disappeared from the account, believed to be a NAB term deposit, over which Melbourne-based legal firm Christopher William Legal was reportedly acting as trustee.

Dubber chief executive Steve McGovern has been suspended. Picture: David Geraghty

No suggestion of any wrongdoing by the firm or McGovern, although our colleague Ben Wilmot reported that caveats have been lodged against McGovern’s home in suburban Melbourne over the last month. There’s also the small matter of an ASIC referral in the works.

No doubt it’s a terrible look for the company’s board, chaired by Victoria Racing Club chairman Neil Wilson, and we know certain billionaire investors – *cough* Alex Waislitz *cough* – aren’t impressed either. About $3.4m has been recovered of the missing funds with $26.6m still on the lam, or nearly one third of Dubber’s $86.06m market value.

The silver lining seems to be that the company’s close to clinching a rescue deal. It has a short-term loan of some description (yet to be announced) and is figuring out the details of a $20m capital raise that you best believe will come at a steep discount to the closing price. That’s to replace the money now missing and provide a bit of air to keep operating. There’s even some suggestion that an announcement might be made as soon as Friday, pending whether Dubber pulls it off, and pending the approval of the auditors at EY. In the meantime, still no word on where all that money walked off to.