Looks like Magellan is seeing another significant departure from the business, with long-serving group executive Craig Wright exiting the firm under mutually agreed terms – it seems he was clearly unsatisfied and the feeling was reciprocated.
Not because of anything Wright had necessarily done, but rather because of the almighty reorientation taking place at the embattled funds manager under its newly appointed chief executive, David George.
Given the speed with which those plans are being implemented, and the facelift being given to the business, it’s difficult to see how Wright could have stayed in a shrinking role and remained anything but miserable.
Wright helmed Magellan Capital Partners, the division responsible for Magellan’s external investments in capers like Guzman y Gomez – the firm sold its 11 per cent stake earlier this year for a tidy sum of $140m. Aside from announcements to the market it’s been difficult to glean much else about Wright, despite almost 10 years at the firm; every last detail pertaining to him has been expunged from the website.
It’s been recently made clear enough that external investments were to be scaled back in favour of revitalising the business through good old-fashioned funds management.
George reckons he can bring inflows back up past $100bn from whence they were hovering last year. We’ll believe it when we see it, of course.
Funds under management are currently resting around $50bn, while the share price is fathoms below the $70 highs recorded in the lead-up to the pandemic, or the $35 price at which Magellan’s employee share options can be exercised.
These were provided in some cases using full-recourse loans, meaning they have to be paid back in full to Magellan. Wright, we note, held 75,000 of these share options as of June 30 and purchased an additional 5,836 shares with what looks like a $300,000 loan that, as of the same date, was mostly outstanding. Due to the decline in the share price it appears that he was down almost $100,000 on the loan, and that stock has only continued to dive, closing down 5.7 per cent on Thursday.
No suggestion, of course, that Wright’s departure will lead to any adjustments to Magellan’s other investments, including its 36 per cent ownership of Barrenjoey Capital or its 16 per cent interest in financial services outfit Finclear.
But we do get the impression that in the great swell of change under way, including 10 very recent staff redundancies, there was little room left over to accommodate him in the liferaft. As if we need to remind anyone, Wright’s departure follows a series of other senior executives who have made for the turnstiles, including former chief executive Brett Cairns late last year, and Magellans’ co-founder and former chief investment officer Hamish Douglass, who started in his consultancy role early in October. Magellan declined to comment and Wright could not be reached.
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Cable car canned
We had all the expectations that Melbourne deal-cutter David Williams would be toasting his victory on Thursday evening after sealing a $1.7bn takeover of the Tasmanian company that he once brought out of receivership, Tassal.
But that success, we’re told, was somewhat marred by disappointing developments elsewhere on the Apple Isle, where a tribunal has blocked another one of Williams’ investments from getting off the ground – and we mean that in the most literal sense possible.
Williams is a co-funder of the Mount Wellington Cableway Company and its plans to construct a chairlift that will shepherd tourists to the pinnacle of Mount Wellington, at the foot of which one can find the state’s capital.
The case for the project is simple enough: it stands to enhance the tourist experience and free up the mountain‘s narrow roadways, which often get clogged up with cars when it’s snowing or wet.
It’s all been in the works for more than a decade and engulfed in much red and green tape with Hobart City Council, which denied the company’s permit in July 2021, resulting in an appeal. Tassal’s shareholders were overwhelmingly voting in favour of a takeover offer by Canadian seafood Cooke while the Tasmanian Civil and Administration Tribunal was simultaneously releasing its decision.
It dismissed the company’s appeal in a 114-page judgment that listed a slew of opposing parties in addition to the council, including the Tasmania Water and Sewerage Corporation, the Tasmanian Conservation Trust, Residents Opposed to the Cable Car Incorporated, Bob Brown Foundation, South Hobart Progress Association, and others. “One step forward, two steps back,” Williams told us.
“A big step forward with Tassal and the Canadians coming in, and a big step backwards which has shocked me to be honest, because I thought it was a no-brainer to improve access to the mountain.”
No word yet on whether the cable car’s proponents will lodge yet another appeal to a higher power, such as the Supreme Court.
Asked if he would celebrate despite the loss, Williams remained good-humoured.
“It will be St Henri, not Grange,” he said.
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