Tabcorp Chairman Backed Directors: What You Should Know?

Consumer

The chairman of Tabcorp Holdings Limited (ASX: TAH) stood to back the attempts which were being made to attack the accountability as well as performance of the directors. The attempts were witnessed in regard to its plans to expand into Britain which, however, failed. As per the chairman of the company, the proxy advisers as well as investors were shooting questions on the directors’ as well as management’s accountability. These questions were flooded over the joint venture of SunBets with the New Corporation in Britain which the company abandoned. The questions were also raised over the anti-money laundering provisions which were breached by the company and, as a result, the action was taken by the AUSTRAC or Australian Transaction Reports and Analysis Centre.

The chairman of Tabcorp stated that the company’s board acted in a strong position in respect of the concerns related to the money laundering. She also stated that the government agency i.e. AUSTRAC was also able to acknowledge the response which was provided by Tabcorp. The chairman is of the view that doubting the directors’ accountability is incorrect as well as unfair. Coming to the second one, the chairman stood even more stronger for the SunBets case. According to her, the risk was taken by the company was completely reasonable as the startup was not expected to impact the dividend of the company. However, the management of the company had witnessed a fall in their remuneration. 

The board of Tabcorp deals with the issues as well as opportunities in a vigorous manner. The deal with SunBets was surely a strategic one but the Tatts deal is another strategic opportunity. The top management is highly optimistic about the outlook of the company and views that deployments would be necessary in any business to achieve growth. They also stated that these types of investments also help in boosting the shareholders’ value as well as broader economy. These investments generally pay off in the long-term. The top management, while backing the actions, stated that all the investments would not be working as they have planned.

Tabcorp witnessed the strike against the remuneration report for the key personnel from the shareholders in the official meeting and hence key personnel decided to cut the entire bonuses so that the merger completion with the Tatts Group gets executed. The proxy advisers as well as investors were not impressed in respect of the cash and share payments and the chairman of the company stated that the company will be altering the conditions in regard to the share payments.

Even though the company did come out with the trading update, Deutsche bank reflected favorable views for the company’s outlook for 2019.

Tabcorp ended the day (October 17, 2018) with the stock price of A$4.760 per share which implies an increase of A$0.120 or 2.586% intraday. The company has a market capitalization of $9.35 billion. Its annual dividend yield stood at 4.53% and the company’s stock price is presently trading slightly towards the lower range.

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