It was a very expensive announcement from EML Payments on Monday as news of the sudden resignation of the CEO cost the company more than $100 million in lost market value for the day.
Investors soured on the news from EML Payments that long time CEO, Tom Cregan was going immediately without explanation. News that the company had found a replacement from the company’s existing board of directors had no impact on a share price that was underwater all day.
Mr Cregan will be replaced by independent director Ms Emma Shand “effective immediately”.
EML shares ended at 96.5 cents, which puts them down more than 70% so far this year and the lowest they have been for two and a half years. The shares’ most recent peak was $3.39 in January.
Monday’s fall wiped more than $100 million off the value of EML, so the unexplained loss of the CEO was a very expensive move for shareholders.
Monday’s announcement was, however, notably silent on the reason (or reasons) for the abrupt departure of Mr Cregan from the CEO’s slot.
Peter Martin, EML’s Chairman had a good line of spin in Monday’s statement: ‘This is an exciting time of opportunity for EML, and Emma has an ideal set of attributes to lead the company into the future. Emma will provide highly professional leadership through a period of very rapid change.’
“Ms Shand is a very successful executive with 25 years’ global experience in technology, capital markets and diversified financial services across 30 different countries. This includes over 16 years in senior management roles with US based market leader Nasdaq.
“Ms Shand has deep executive experience in a broad variety of operating and technology environments and diverse cultural settings. She has worked with highly regulated markets, governments and disruptive companies across a variety of sectors. In light of EML Payment’s significant European business, Ms Shand will dedicate substantive time and presence in Europe.
Mr Martin added, ‘Emma has served as a member of the EML Board of Directors since September 2021. She brings a deep appreciation of the exciting growth opportunities ahead for EML in a world rapidly transitioning to digital payments. Importantly, she has a very impressive track record initiating and overseeing complex, transformational change.’
Mr Martin said, ‘We all owe a real vote of thanks to Tom Cregan who has been an integral part of the EML growth story for over a decade. He has tirelessly led the Company from a small technology business in Australia to a diversified payments leader operating in 32 countries.
“EML has been an exciting growth story of rapid international expansion, not without its challenges. Without Tom’s deep payments knowledge, drive and commitment, EML would not be what it is today.’
“Mr Cregan will receive his contractual entitlements and his equity will be treated in accordance with the terms of grant. No termination benefits will be provided. Ms Shand’s employment terms will be announced in due course,” EML’s statement concluded.
