In a shock move, underperforming rail and ports operator Asciano Ltd has replaced its CEO, Mark Rowsthorn with the appointment of the former global head of freight giant, DHL Express, John Mullen.
Mr Mullen succeeds Mark Rowsthorn, according to statement.
There was no real explanation to the market from either the company or Mr Rowsthorn.
Asciano shares rose 4.5c to $1.695, the highest they have been since mid-October.
It has to be pointed out that in a statement last Wednesday, February 1, Rowsthorn was extensively quoted as CEO, and five days later he’s gone with thanks.
So now the two driving forces behind the takeover of Patricks in 2006 by Toll Holdings, and then the controversial splitting of that company in 2007 into Toll and Asciano, have gone or are going (Toll’s Mr Little has signalled a long retirement, going by the end of this year).
Could Mr Rowsthorn end up at his old home and replace his mentor in Mr Little at Toll?
This change was no planned departure, like Mr Little’s.
In fact it indicates that the company had a replacement it had been talking to and getting in place before the board moved on Mr Rowsthorn.
Mr Rowsthorn is gone (but staying on until later this year to help in the transition, as per the terms of his contract, according to the statement).
Mr Mullen, who also sits on the boards of Telstra, Brambles and MAp Airports (and will leave those positions at Brambles and MAp), will start at Asciano next Monday.
Mr Mullen was chief executive of DHL Express from 2006 to 2009. Before then he was boss of DHL Express’s Asia-Pacific and also held senior positions at TNT for a decade.
The company’s fortunes have improved since it narrowly avoided collapse in 2009 when it was forced to raise $2.35 billion to ease its crippling debts.
Asciano has never reported a full-year profit since it was split from the transport giant Toll Holdings in 2007.
In fact it has been one long trail of red ink.
Its losses widened to $976 million for the year to last June, from $244 million previously, after it booked $1.13 billion in write-downs on its Patrick stevedoring business.
Toll had loaded Asciano with too much debt at the time of the split and the credit crunch and global recession caught up with the company.
The salary and bonuses paid to Mr Rowsthorn and other executives have also been a sore point for many shareholders.
That was made more galling for shareholders given the huge losses and write-downs and silly deals, such as the stalking of Brambles in 2007 just as the global financial crisis burst upon global markets, ending the days of cheap credit which fuelled the growth of Toll and then Asciano.
Although Asciano is yet to make it into the black, Mr Rowsthorn has collected almost $4 million in cash bonuses over the last three years.
Asciano said more details of Mr Rowsthorn departure package would be published in June, just before he leaves officially.
Asciano Chairman Malcolm Broomhead said in yesterday’s statement that the change "comes after the Company reached several key milestones in 2010 including its refinancing, restructuring and repositioning of the Company".
“The availability of a person of John’s calibre and skill set provides shareholders with comfort that the Company will be in good hands going forward,” Mr Broomhead said.
“John will lead Asciano into its next phase with his significant industry experience and proven track record. He will build on Mark’s work and tireless commitment as CEO since the Company’s demerger from the Toll Group in 2007.”
Mr Mullen has had extensive experience in the transport and logistics arena.
Most recently he was Global CEO of DHL Express from 2006 to 2009 and Joint CEO in 2005. Before then he was CEO of DHL Express Asia Pacific and held senior positions with the TNT Group for 10 years.
Mr Mullen had more recently left these executive roles returning to Australia to take up non-executive directorships with Telstra Corporation Limited, Brambles Limited and MAp Airports Limited. Mr Mullen will remain a director of Telstra.
“With John’s strong background in the logistics industry and Asciano’s fresh management team in place, the Company is in a good position to pursue its strategic vision and deliver value to shareholders,” Mr Broomhead said.
Mr Broomhead also thanked Mr Rowsthorn for his contribution and acknowledged his success in steering Asciano through a significant period of change.
“He has lived and breathed Asciano for four years and was a key part of the Toll Group before the separation to form Asciano.
“On behalf of the Board and staff, we wish him all the best in his future endeavours.
"In accordance with the provisions of his contract, Mr Rowsthorn will remain an employee of the Company until 15 June 2011 and will assist with transitional arrangements as needed."
