Andrew Price will sue Paperlinx in federal court over his abrupt sacking from his post as chief executive – as soon as he gets the go ahead from Fair Work.
Price confirmed to ProPrint that the lawsuit for ‘adverse action’ will go ahead in the next two weeks, after conciliation talks with the company broke down in March.
The colourful print identity, who has just been named Asia Pacific boss for print manager HH Global, says he was sacked by the embattled paper merchant after refusing to resign.
Price says he had been working on an ambitious plan to save the European operations with a $100m capital raising to restructure the business, and pay out the $280m worth of hybrid shareholders.
[Related: See you in court!]
The deal was scuttled by opposition from the company’s second biggest shareholder, who was concerned the plan would heavily dilute his share value. Price fell out with the board when he was told not to pursue it.
“I believe I was dismissed as CEO as a result of making complaints regarding my employment, including in relation to me not being allowed to explore options to deal with the hybrids and restructure the European businesses,” he told ProPrint.
“The Fair Work Act and other legislation prohibit employers from dismissing employees for raising issues of this kind. Further, I believe this type of conduct should not be tolerated in corporate Australia.”
Price says he is still owed salary, superannuation, expenses and other payouts from months before he was sacked and was shut out of decision making by the board and not even allowed to scrutinise payments to consultants or executive expenses.
He also believes the European fire sale could have been avoided if he had been given more time to raise the funds, having secured in-principle support from financiers.
“As a top ten shareholder in Paperlinx, I am gravely concerned about the value of my equity while the issue of the hybrids is neglected,” he says.
“In my opinion, putting the European businesses into administration and ignoring the hybrid issue is going to have serious consequences in the future for equity holders as all of the residual value in Paperlinx has now passed to the hybrid holders.”
[Related: The ups and downs of Paperlinx]
Price tried to buy out the hybrid holders last year with a 10c in the dollar offer in exchange for just over half the company’s shares, but only about seven per cent of holders took up the offer.
At the time, the hybrids represented 78.6 per cent of Paperlinx’s $351.9m total equity, and with more than half the business sold off or liquidated they will now own a much bigger chunk.
Another point of friction with the board was the sale of Spicers Canada for $65m, which Prices says was less than half what it was worth.
Price and his legal team are now awaiting a certificate from Fair Work Australia stating that conciliation has failed, which is a requirement for launching the lawsuit.
‘Adverse action’ is similar to unfair dismissal, but Price is not eligible as his more than $1m salary was too high to qualify. Adverse action does not necessarily have to involve a sacking.
Comment below to have your say on this story.
If you have a news story or tip-off, get in touch at [email protected]
Sign up to the Sprinter newsletter