Australian media mammoth Publishing & Broadcasting, whose subsidiaries include TV Channel Nine and magazine publisher ACP, watched its stock value plummet yesterday following ceo Nick Falloon’s departure on Tuesday.
News that the well-regarded Falloon will be succeeded by Peter Yates, an investment banker whom analysts fear lacks experience, did not meet with a rapturous reception. P&B stock sank 6.2% to A$9.90 ($4.95) on the All Ordinaries market, a 16-month nadir, with 7.3 million P&B shares changing hands.
Meanwhile, several analysts changed their P&B share recommendations from buy to hold or neutral. Commented one such guru: “People will want to meet him [Yates]. They will want to get a view for what his strategy is. There is some concern in the market that given this guy’s background he is going to be looking to make lots of deals and that makes people nervous, so it’s going to take a bit of time to settle.”
P&B itself was tight-lipped about Falloon’s departure, though it is thought his relations with chairman James Packer had been steadily deteriorating. However, the group stressed that Yates, who happens to be a friend of Packer’s, was “exceptionally well qualified” for the post of ceo, having gained experience in the media, telecoms and gaming sectors.
News source: Wall Street Journal