A BATTLE for control of listed 4WD accessories seller Automotive Solutions Group (ASX: 4WD) has begun with an activist shareholder and director calling an EGM to replace two fellow board members at the struggling company.
ASG non-executive director Bryce Wedemeyer used his 5 per cent stake in the company to trigger the EGM in which he called for the removal of Peter Alexander and Mark Larkham as directors to "rebuild the company and return it to profitability".
The Brisbane-based ASG has, in turn, called its own separate EGM two days later through three requisitioning shareholders to try and force the removal of Wedemeyer from the board.
Since listing on the ASX in December 2016 at $1.00, ASG's share price has slumped by 80 per cent to around $0.20. Its share price dropped 66 per cent over just two days in April when it issued a profit warning caused by increased competition and postponed orders.
Nearly $25 million was wiped off the company's value over those two days when ASG reported its second half profit would be between $800,000 and $900,000, down from its initial forecast of $3.3 million.
Shortly after, ASG CEO and managing director Tanya Mason stepped down as the company began a turnaround strategy with Wedemeyer as interim COO and then it faced a takeover bid from listed smash repairs firm AMA Group (ASX: AMA), which it successfully defended by early July.
On 28 August, Peter Alexander became chairman and Bryan Granzien was appointed as CEO and Wedemeyer reverted back to his role as non-executive director.
In announcing the EGM, Wedemeyer said Alexander and Mark Larkham's "have no public company experience or turnaround experience" and also criticised Granzien's appointment, saying he has no automotive experience.
"Since the appointment of Peter Alexander to the chair and Bryan Granzien as CEO, the share price declined approximately 25 per cent in 30 days," Wedemeyer says.
Granzien is a former director of Omni Market Tide (ASX: OMT), a virtual shareholder engagement technology company chaired by Brisbane-based lawyer Glenn Vassallo. In its half year results to 30 June, 2017, Omni Market Tide reported a loss of $233,000 compared to $2.46 million in the prior corresponding period.
Vassallo's firm, GRT Lawyers, provides legal advice to ASG and Wedemeyer says Granzien is a former employee of the law firm.
"The outgoing directors appointed Bryan Granzien as CEO despite the fact that he lacks experience, credibility and credentials," Wedemeyer says.
The EGM called by Wedemeyer will be held on 13 November. The EGM called by ASG will be held two days later.
Business News Australia
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