Last call for Guinness Peat stalwart

AN ERA is ending at once-feared corporate raider Guinness Peat Group with the departure of Gary Weiss, for 20 years the right-hand man of the company's driving force, Sir Ron Brierley.

By InvestSMART · 1 Apr 2011

By InvestSMART ·
1 Apr 2011

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AN ERA is ending at once-feared corporate raider Guinness Peat Group with the departure of Gary Weiss, for 20 years the right-hand man of the company's driving force, Sir Ron Brierley.

Mr Weiss is to resign as executive director of GPG on April 30, following in the footsteps of Sir Ron, who has already foreshadowed his retirement. Although Sir Ron remains a director, he stepped down as chairman in December.

For many years, Mr Weiss has been a fixture at the annual meetings of companies singled out by GPG, his famous red afro striking fear into the hearts of struggling boards.

But with GPG winding down and selling off its portfolio, it is unlikely Mr Weiss will again be seen delivering his long tirades against company management from the meeting-room floor.

The wind-down has sparked a rebellion among shareholders who believe the process, first flagged before the global financial crisis, has taken too long and delivered too little.

Yesterday, chairman Mark Johnson used his statement in GPG's annual report to promise shareholders the company's sell-down would deliver an "initial capital return to shareholders of at least A#75 million [$120 million]".

Mr Johnson is to quit the board due to "other commitments and priorities", GPG said yesterday.

Energy group Alinta, formerly owned by Babcock & Brown, yesterday appointed Mr Johnson chairman as it prepares to delist its shares from the stockmarket.

Alinta's new owners are its former financiers, led by private equity group TPG, who have swapped $3.5 billion debt for equity in the group. The deal saw Alinta security holders, including GPG, which held 19.9 per cent of the company, paid out about 10A? a security.

GPG intends to sell off the rest of its investment portfolio, which includes stakes in developer AV Jennings and Britain's Newbury Racecourse.

This may reduce an investment in GPG to an investment in its haberdashery subsidiary, Coats, Mr Johnson said in his chairman's report.

The Coats annual meeting is one at which shareholders will continue to see Mr Weiss. He is to remain chairman of Coats for at least a year, GPG told the exchange yesterday.

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Frequently Asked Questions about this Article…

Why is Gary Weiss resigning from Guinness Peat Group (GPG) and when does his resignation take effect?

Gary Weiss is stepping down as an executive director of Guinness Peat Group as the company winds down its investment business. His resignation is effective April 30. Weiss had been Sir Ron Brierley’s right‑hand man for about 20 years and was a prominent presence at GPG‑targeted company meetings.

What does Sir Ron Brierley’s recent change in role mean for Guinness Peat Group?

Sir Ron Brierley stepped down as GPG chairman in December but remains a director and has foreshadowed his retirement. His reduced role, together with Weiss’s exit, marks the end of an era as GPG moves through a planned sell‑down of its portfolio.

What is the GPG sell‑down (wind‑down) and why are shareholders upset?

GPG’s sell‑down is the process of selling off its investment portfolio, a plan that was flagged before the global financial crisis. Some shareholders have rebelled because they believe the wind‑down has taken too long and delivered too little value back to investors.

What capital return has GPG’s chairman Mark Johnson promised to shareholders?

In GPG’s annual report, chairman Mark Johnson said the sell‑down would deliver an initial capital return to shareholders of at least A$75 million (about US$120 million). Johnson also indicated he will quit the GPG board because of other commitments.

How did the Alinta deal affect GPG and what role did private equity play?

Alinta was recapitalised by its former financiers, led by private equity group TPG, in a transaction that swapped about $3.5 billion of debt for equity as Alinta prepared to delist. GPG held a 19.9% stake in Alinta and received a payout to security holders as part of that deal.

Which remaining investments does GPG intend to sell and what might be left after the sell‑down?

GPG intends to sell the rest of its investment portfolio, which includes stakes in developer AV Jennings and Britain’s Newbury Racecourse. Chairman Mark Johnson warned that after the sell‑off GPG could be reduced largely to an investment in its haberdashery subsidiary, Coats.

Will investors still see Gary Weiss at company meetings after his GPG resignation?

While Weiss is likely to be much less visible at GPG‑related meetings as the group winds down, he will remain chairman of Coats for at least a year, so shareholders can expect to see him at Coats’ annual meeting during that period.

What practical takeaways should everyday investors get from the GPG wind‑down story?

Everyday investors should note that wind‑downs can take years, may prompt shareholder unrest if returns disappoint, and often involve management and board changes. Watch company statements (like GPG’s pledged A$75m initial return), track progress on asset sales, and be aware that remaining holdings can shift from diversified investments to a small number of assets as a sell‑down concludes.