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AUSTRALIAN Agricultural Co managing director Hugh Killen has resigned from the company, in a dramatic development this morning.
In a statement to the ASX this morning, AA Co chairman Don McGauchie advised investors and the market of Mr Killen’s departure, effective immediately.
AA Co’s chief operating officer Dave Harris will take up the role of acting chief executive. The board will now conduct an executive search process that will include internal and external candidates in the domestic and international market.
The announcement comes just days after speculation mounted on Friday that WA billionaire Twiggy Forrest might mount a takeover bid for AA Co (see Beef Central’s earlier report).
Whether the two are connected in any way is open to conjecture, but there is no clear evidence at this time.
Others suspect the move has major shareholder, UK billionaire Joe Lewis’s fingerprint on it. Breakdown in cooperation between the AA Co board, with multiple agendas, and senior operations management has been a frequent companion of AA Co over the past 25-odd years, history shows.
“Hugh joined AA Co in 2017 and was appointed to the role of managing director and CEO in 2018,” Mr McGauchie said.
“He has steered AA Co through some of the worst droughts and floods Australia has ever seen, the global impacts of COVID and market fluctuations which occurred as a result of market impacts. He has focused on delivering AA Co’s branded beef strategy, built a team encompassing the next generation of leadership and led the turnaround of the company’s performance,” Mr McGauchie said.
“By delivering on AA Co’s brand potential and investing capital back into the business, Hugh has balanced the need to strengthen the foundations while leading a simpler and more efficient AA Co to create value for shareholders. Through Hugh’s tenure, AA Co has delivered an annual positive operating cash flow, posting its strongest financial results in 2022 since relisting on the ASX in 2001.
“Creating a sustainable future has been one of Hugh’s key drivers while at AA Co,” Mr McGauchie said.
In November 2021, Mr Killen announced AA Co’s Sustainability Framework, the first of its kind for the beef industry with three key themes: reimaging agriculture, valuing nature and thriving communities.
Historically, AA Co has struggled to retain managing directors for periods much longer than four years. Mr Killen’s predecessors, Jason Strong, David Farley, Richard Thoms (custodial) and Peter Holmes a Court all held their posts as the head of operations for only a few years each. Only Don Mackay (nine years), John Griffith (13 years), Trevor Schmidt (30 years) and Dolf Schmidt (30 years) had considerably longer tenure, but Messrs Griffith and Schmidt’s terms pre-dated the company’s public listing.
Mr Killen’s resignation adds a heightened level of interest in AA Co’s annual general meeting, scheduled this year for July 28.
He has recently come under scrutiny from the city financial press – widely interpreted within the industry as both unfair and unsavoury – over claims of favouring his former Sydney boarding school with fund-raising activity connected with AA Co, and his personal affairs.
- AA Co shares closed at $2.30 this afternoon, having risen another 9c since trade opened this morning. The stocks now sit at their highest level since 2008.
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