By Tracy Lee
FUND manager Perpetual has chosen an external candidate to lead the group.
This, as it battles to co-ordinate its divisions and steady a faltering share price.
Chris Ryan, who last held an advisory role with Citibank’s global transaction services business in Hong Kong, will become Perpetual’s new chief executive on February 14.
With about 30 years of experience in financial services, including stints as managing director of Fidelity Asia and chief executive for ING Investment Management Asia Pacific, Mr Ryan was described by Perpetual chairman Peter Scott as “very experienced and very well rounded”.
“He will bring a very balanced and experienced perspective in financial services . . . and a detailed understanding of asset management both in Australia and the Asia-Pacific,” said.
There were internal candidates on the shortlist for CEO but Mr Scott said the board was attracted to Mr Ryan’s strong mix of skills and experience.
Analysts said Mr Ryan’s appointment was a short-term positive for the group as it settled the issue of succession, but the fundamental question of unlocking shareholder value remained.
Just before Christmas, Perpetual’s shares had been buoyed by a potential $1.75 billion bid by private equity group Kohlberg Kravis Roberts. The bid valued the stock at between $38 and $40 but the withdrawal of the offer in late December sent the shares into a downward spiral.
“The board’s certainty that it could extract a bid better than the $40 mark has drawn a bright line in the sand and what shareholders will want from the new CEO is some kind of plan that will deliver that value,” said one analyst.
Shares in Perpetual, which have languished since the removal of the KKR bid, closed 22c lower at $31.60 yesterday.
Perpetual has three key business units: the legacy corporate trust business; the investment management division (its biggest earner); and private wealth.
There is little synergy between the units and there has been speculation Perpetual could sell the corporate trust arm to return value to shareholders.
Macquarie analyst Michael Wiblin has previously estimated that a special dividend could provide a further $2 return on its shares while the sale of its corporate trust business could boost the stock by $5. He also said Perpetual could consider a defensive acquisition. Some have speculated that it could target IOOF Holdings.
But any reworking of the group’s structure is unlikely to materialise for six to 12 months as Mr Ryan settles in.
The new chief will receive a base salary of $1.23 million but has the capacity to earn up to $3.67m if he meets all the targets for his short- and long-term incentives.
In addition, Mr Ryan will receive $500,000 in cash as a sign-on bonus and is set to receive a further $600,000 in shares as a so-called one-off incentive grant.
Outgoing CEO David Deverall, who has been at the helm for seven years, will stay until March 31 to assist the transition.
Source: www.theaustralian.com.au
