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Paperlinx cuts Price with immediate effect

Thursday, 19 February 2015
By Print 21 Online Article

Two months ahead of the end of his contract, Andrew Price, the hard-driving managing director of PaperlinX is unceremoniously fired in London.

Hard on the heels of the sale of the sale of Spicers Canada, and amid talk that the troubled European operations of the company will also be sold, Robert Kaye, chairman is stepping into the CEO role pending a replacement. The shock announcement follows two turbulent years of Price vigorously restructuring the company, especially its loss-making European operations. He located to London to be close to the action.

Making few friends in the process , Price has cut a swathe through the European paper merchanting industry, closing facilities and firing hundreds of workers across the continent. He famously brought former Heidelberg Australia chief, Andy vels Jensen on board to run the UK operations while he negotiated with unions and regulators to downsize the German and Eastern European operations.

A substantial change in shareholding this week saw seven percent of the company come under control of a Sydney-based investor. The movement fuels speculation that the profitable Spicers Australia and NZ companies may follow the Canadian example and be sold off too.

In a statement to the Stock Exchange Paperlinx said:

Mr Price was appointed to the Board as a non-executive director in September 2012 and became Managing Director & CEO in September 2013.

The Board believes the Group will benefit from new leadership as it continues to evaluate all strategic options as part of the Strategic Review (‘Review’) announced on 22 December 2014.

As previously announced, the Company is in discussions with several interested parties which may or may not result in the sale or restructure of part or all of its European operations. In addition to potential asset sales, the Board is considering other alternatives such as but not limited to capital raisings and capital restructuring.

On 11th February, the Company announced the sale of the Canadian operation Spicers Canada to Central National – Gottesman Inc. subject to the satisfaction of certain conditions, and completion is expected at the end of February.

During his tenure at the top, Price significantly reduced Paperlinx’s losses, which before he came on board were threatening to bring the company down. However, this did not translate into improving shareholder value, with the yesterday’s stock quote at just 3.3 cents on a downward trend, despite the ASX steadily rising to be at a 9-year high. In 2011 Paperlinx shares were trading at 75 cents.

No reason has been given for Price’s forced exit. Print21 is seeking comment from both sides.

Happier days; Andrew Price (right) at the Print21 Ipex BBQ in London march 2014 with Patrick Howard.

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