McGrath shares in trading halt as ‘clarification’ sought
MCGRATH is seeking “urgent” clarification from founder John McGrath in relation to media reports alleging gambling-related debts and borrowing, with the company saying it has new information.
McGrath shares were placed into a trading halt yesterday, with outgoing chief executive Cameron Judson saying any update would be “contingent upon John McGrath providing further information.”
“The company has become privy to further information, which I can’t comment on, and is seeking urgent clarification from John McGrath,” Mr Judson said during an investor call following the company announcing a $25.5 million firsthalf loss.
“The board has considered this trading halt a significant development and let me assure you they have not taken this step lightly.”
Recent reports from Fairfax Media have claimed Mr McGrath has $16.2 million in gambling debts with betting company William Hill Australia.
And a report from News Corp’s The Australian claimed Mr McGrath has a $100 million margin lending facility connected to a private investment company.
Mr McGrath has denied all the allegations and McGrath Ltd advised the ASX on February 8 that the company founder had confirmed there was no margin lending facility related to his McGrath stake, nor had the shares been used as security for a loan.
Mr Judson will leave McGrath today, in line with a senior management and boardroom clean-out announced in January.
Yesterday, the business confirmed that company secretary Morgan Sloper, chairman Cass O’Connor and the rest of the will leave by February 19. Mr McGrath will take on the chief executive and chairman roles. Mr Judson denied there has been a mass exodus and said the changes put the company on a lower cost base. McGrath Ltd unveiled a net loss of $25.5 million for the six months to December 31, due to significant impairments and ongoing troubles with lower volume listings, a decrease in its real estate agent numbers and a fall in the number of properties under its management.