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Not every business is suited to a public listing, with LJ Hooker’s board and shareholders deciding that an IPO is not right for the network, the company’s outgoing managing director says.
Grant Harrod’s comment follows the shock news overnight of his resignation, leaked by Fairfax Media.
But the leaked story contained several inaccuracies, Mr Harrod said.
Setting the record straight, he said he was hired at the start of 2014 as an experienced listed-company CEO, a focus of the shareholders and board at the time.
“Then toward the end of last year, the board made the decision that that it wouldn’t head down that path because the distraction to the business was too great,” Mr Harrod told REB.
“I said to the board that it doesn’t need someone with my skills and experience. I had a three-year contract ... and said I am happy to stay around and work on a transition and we can find a replacement.”
Media speculation about an LJ Hooker IPO has run rife for months. Some suggested that the network wanted to use the IPO to raise capital to bail out a significant debt that was about to fall due.
Mr Harrod again dismissed the rumour. However, he reaffirmed LJ Hooker’s growth ambitions and its intentions to undertake “some form of capital management initiative” at some point in the future.
“We don’t have any facilities that expire before 2020, so speculation that we had to do something by December 31 is fundamentally incorrect,” he said.
Fairfax also suggested there had been a fallout between Mr Harrod and the board.
But he denied any acrimony.
“Sometimes the proof is by way of a person’s action. If there was acrimony I wouldn’t be hanging around for the next six months.”
Mr Harrod added that his resignation does not mean LJ Hooker’s growth strategy “is dead and buried”.
“It just means that we will now look at alternative capital measures and certainly we have pushed that out from a timing perspective.”
Mr Harrod said the company is focused on building the tools it needs to maximise the digital opportunity.
In the last three years with Mr Harrod at the helm, LJ Hooker has increased its market share, taken its brand awareness to its highest level and added nearly 80 new offices to the network. It also embarked on a digital transformation strategy that included cloud-based CRM systems, the launch of 610 personalised new websites and the rollout of a new financial management system in its corporate office.
Mr Harrod said his focus at the moment is on LJ Hooker.
“I have made some amazing relationships and certainly loved my time here and will forever be a part of the brand and the journey,” he said.
“I will focus on my next endeavours when I have completed the work that I have got to do here.”
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