CTM steadies its shares

CORPORATE Travel Management has reiterated that no substantial new issues have been raised by hedge fund VGI in a supplementary report issued earlier this week, with the company’s shares surging almost 10% after the ASX opened today.

CTM’s response (TD breaking news) once again noted the “significant vested interest” by the raider in driving the share price downward, adding that “at the core of VGI’s conclusions is a fundamental misunderstanding of the corporate travel sector and the CTM business model”.

The company noted it had engaged accounting firm EY to help respond to matters raised by VGI, adding it had specifically chosen EY because of its travel sector experience - most notably as the auditor of Flight Centre.

CTM’s own auditor, PwC, is also the auditor of Helloworld and looked after Hogg Robinson Group prior to its acquisition by American Express Global Business Travel earlier this year.

EY’s preliminary observations indicate that VGI’s report is “superficial”, with a summary addressing key points raised by the hedge fund around goodwill, working capital, cash and interest.

CTM said it “does not intend to have the business distracted by baseless and self-serving claims,” with the Board confident its strategy would continue to deliver benefits for customers, staff and shareholders.