Former Bunnings and Officeworks exec Phillip Bishop joins Reject Shop as new CEO

A former Bunnings executive has been tapped to run the no-frills retailer, as a potential buyback may help billionaire Raphael Geminder tighten his grip on the firm.

The Reject Shop has hired a former exec from Bunnings and Officeworks as its new CEO, sending the shares up 22 per cent: Picture: Mark Stewart

Shares in The Reject Shop surged more than 20 per cent following the appointment of former Bunnings executive Phillip Bishop as its new boss.

The rally almost made up for the 25 per cent dive in late April following the shock departure of former chief executive Andre Reich.

The hiring of the new CEO comes as packaging billionaire Raphael Geminder could tighten his grip on the retailer’s share register with The Reject Shop also announcing on Thursday that its board is considering a share buyback.

Mr Geminder launched a $78m takeover bid for The Reject Shop four years ago, which ultimately failed to cede him full control of the retailer, but he has since built up a 20 per cent stake and exerts some influence within the company.

The Reject Shop is now considering a share buyback, and could unveil the capital management strategy next month. If Mr Geminder were not to sell his shares into the buyback it could see him rise up the share register.

Mr Bishop has been tasked to lead the retailer through one of the most volatile trading environments seen in decades where discretionary retailers such as The Reject Shop could see their earnings squeezed.

Mr Bishop, who has three decades of retail experience, will take the reins on July 11.

Most recently, he held senior roles at Bunnings, including the role of director merchandise and marketing, but he left the hardware chain giant suddenly last year. Prior to that, he was in various senior roles at Officeworks, including the role of chief operating officer.

In February, former Officeworks managing director Mark Ward was appointed to The Reject Shop board.

“Phil joins The Reject Shop at a time when the company has executed on the initial phases of its turnaround strategy. The company is now well positioned with a lower cost base, an experienced and talented senior leadership team and growing national store network supported by a strong balance sheet, all of which will underpin the growth phase of the turnaround strategy,” The Reject Shop said in a statement.

In April when Mr Reich left the company with no explanation, shocked investors given he was only half way through his five year plan to turn around the company’s performance and had only been CEO for two years. Shares on that day in Reject Shop plummeted 25 per cent.

On Thursday afternoon, its shares rallied 22 per cent to $3.47.

“In my view, there is a significant opportunity to grow The Reject Shop through better understanding its customers, continuing to evolve the product offering and continuing to expand the store network,” said Mr Bishop.

“I’m excited to work with such a great team and I look forward to executing the turnaround strategy and delivering comparable sales growth and creating value for shareholders.”

Mr Bishop will be paid a fixed remuneration of $650,000 and be eligible for short term and long term incentives.