STORY STANDS ASIDE AS ECHO CHAIRMAN

STORY STANDS ASIDE AS ECHO CHAIRMAN

ECHO Entertainment Group (ASX:EGP) chairman John Story (pictured) has surprisingly resigned in the face of a national campaign by billionaire James Packer to unseat him at an extraordinary general meeting (EGM) next month.

Australian Rugby Union CEO John O’Neill, a current Echo Board member, has been appointed as acting chairman.

Packer, who owns rival gaming operation Crown and is a 10 per cent shareholder in Echo, has placed full-page advertisements in newspapers around the country over the last week calling for Story to be replaced as Echo chairman by former Victorian Premier Jeff Kennett.

The advertisements compared Crown’s growth to sluggish Echo operations in recent months and criticised the company for its handling of the sacking of former Star City Sydney casino general manager Sid Vaikunta.

Echo operates three casinos in Queensland: Treasury in Brisbane, Jupiter’s on the Gold Coast and Jupiter’s Townsville.

Packer has been seeking regulatory approval to gain a bigger slice of Echo. It is speculated his long-term plan is to use the company’s Sydney licence to build a new $1 billion luxury gaming facility across the harbour at Barangaroo.

One of Echo’s largest shareholders, Perpetual Investments, today announced it would not vote for Kennett at the EGM. But the decision to remove Story before the EGM suggests the Echo board was not confident its chairman would win a ballot against Kennett.

In a statement released today quoting O’Neill, Echo describes the current events as “challenging times’’.

“The Board of Echo has formed the view that the ongoing disruptive campaign, concerning the resolution proposed to be put to an EGM of Echo for the removal of Mr Story, was damaging to the company and that it was in the best interests of shareholders that Mr Story not contest the resolution,” says O’Neill.

“The Board thanks John for his dedication and commitment to Echo, and previously Tabcorp Holdings Limited, over many years. It was thanks to John’s leadership that we have achieved the de-merger from Tabcorp, which has crystallised significant value for our shareholders in challenging times.”

EGP’s share price was up 3.26 per cent to $4.44 on trading before the announcement. The market appeared to welcome the change with shares trading higher during the afternoon.

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Valuations hit $5.8 billion for Australian crowdfunded startups

Valuations hit $5.8 billion for Australian crowdfunded startups

The latest crowd-sourced funding (CSF) report released by market le...

Cash Converters emboldened by circular economy as revenue rises 26pc

Cash Converters emboldened by circular economy as revenue rises 26pc

Cost-of-living pressures and circular economy trends appear to have...

One small update brought down millions of IT systems around the world. It’s a timely warning

One small update brought down millions of IT systems around the world. It’s a timely warning

This weekend’s global IT outage caused by a software update g...

Netflix NT drama series Territory to debut in October

Netflix NT drama series Territory to debut in October

Netflix is set to launch its next blockbuster Australian drama seri...