The once dazzling online retailer's shares hit an
all-time low…
Do you remember, and you should because it was
three months ago, the surprise SurfStitch v SurfStitch
blood feud?
To quote that story,
Just a few hours ago, the CEO and co-founder, Justin
Cameron, quit his gig “to join forces with a private equity group,
in preparation for a possible bid for the company.”
Meanwhile, the other co-founder of SurfStitch, the
brunette Lex Pedersen, has been left to rock to and fro in his
cubicle! Blood feud?
In The Australian newspaper, Eli Greenblat
reports: “Left stranded is Mr Cameron’s surfing
buddy and fellow SurfStitch co-founder Lex Pedersen, who remains at
the company as managing director in charge of its North American
online business Swell.
“Surfers have been known to get into violent punch-ups over
accusations of being burnt, or having another surfer drop in and
steal their wave, now at SurfStitch it will be private equity
raiders, lawyers and merchant bankers puffing out their chests and
bracing for a rumble.”
Three months later, the once dazzling biz is still doin’ it
tough, its shares hitting an all-time low of under thirty cents on
Friday.
In today’s business news, and as reported by financial reporter
Elizabeth Knight:
Surfing online retailer SurfStitch has comprehensively moved
from being one of the up-and-coming Australian players to a
corporate mystery.
A series of strange events began in early March when its
(then) highly regarded chief executive Justin
Cameron abandoned his job claiming he was teaming up with
private equity to buy the company.
He seems to have since vanished, leaving shareholders to
wonder if the private equity play was a hoax. Both Cameron and the
would-be suitors now appear to be ghosts.
The board of SurfStitch is weighing its options as its share
price remains depressed and the near-term earnings prospects look
equally grim. On Friday morning, the share price fell to its
all-time lows – briefly dipping more than 11 per cent to below
40¢ in morning trade.
After Cameron dropped his sensational departure bomb on
the SurfStitch
board via email in early March shareholders were
left both confused at his unexpected decision and salivating at the
prospect of a bid for their stock.
Three months later, no private equity player has stumped up
with an offer – indeed, the company’s board hasn’t had even a
whiff of an approach from a would-be suitor, rumoured to have
been TSG Consumer Partners – and even more bizarrely the board
has not heard from Cameron at all.
…and…
If the ignominy of the May 4 downgrade wasn’t enough, the
company also received some unwanted attention from the stock
exchange, which issued a query to the company about the fall in the
share price and the spike in volume leading up to the earnings
warning.
So what of Cameron? Some say he is somewhere in
the US, others say that attempts by SurfStitch shareholders to
contact him have garnered no response.
Stranger still was that he left $400,000 of options on the
table when he walked out the door – after declaring to the
chairman that he was “deeply conflicted”.
Former investment banker Cameron founded the company with
the now chief executive Pedersen.
Read the whole story here.
