The AMA Group has appointed Carl Bizon, former CEO of Jayco, as Chief Executive Officer, following the resignation of Andrew Hopkins over allegations of unapproved expense claims and bonuses.
According to a statement issued by the AMA Group, Hopkins resigned as Chief Executive Officer on Sunday 31 January, and under the terms of his employment contract, he is required to immediately resign from the board of directors as well. While he hasn’t served the company that resignation notice yet, the board said it expected to receive it shortly.
While AMA continues to keep quiet about the circumstances surrounding the attempted removal of Andrew Hopkins and his subsequent resignation, The Australian Financial Review (AFR) managed to learn that Hopkins was being investigated by AMA for making unapproved expense claims to the company as well as paying himself bonuses without approval. Hopkins denied the allegations.
“While I categorically deny the allegations against me, I cannot allow this dispute to impact the operations of the company I have been involved in leading since 2015, in an industry I have worked in for 30 years,” Hopkins said in a statement released on Sunday night.
He added that he intended to remain on the board, despite AMA expecting him to resign from it immediately.
According to Federal Court of Australia documents obtained by the AFR, Hopkins’ lawyer admitted that he had incorrectly used AMA’s credit card on personal expenses three times over three years to the tune of more than $6000, but that these expenses were “made by him in error and by him inadvertently using the AMA corporate credit card for expenses which his records will demonstrate were ordinarily paid from his own funds”. The documents added that Hopkins would repay the money.
Now, AMA has told the sharemarket this morning that it will begin proceedings to “recover a sum approximating $1 million”, without elaborating. The amount is a significant increase from the $6000-plus detailed in the court documents.
DISPUTE STRETCHES BACK TO CAPITAL S.M.A.R.T ACQUISITION
According to the court documents, Hopkins’ lawyer said that the allegations only came about after investor concerns about multi-million-dollar payments linked to AMA director Simon Moore, who is also Senior Partner at private equity firm Colinton Capital Partners.
According to the lawyer, it was Moore who wrote to Hopkins on Friday seeking to have him terminated immediately on the basis of the staff whistleblower complaint the company received in September last year. Hopkins countered by saying that the expenses and bonuses were previously approved, but “are now alleged not to have been approved. Regrettably, this allegation is false and made without any proper process,” the documents said.
The documents by Hopkins’ lawyer then dropped a bombshell, according to the AFR.
“Further, and in summary, the corporate background in which this surprising allegation is now belatedly made is that of significant shareholder disquiet about the $4.4 million payment Mr Moore had demanded in 2019 and [Moore’s] proposed removal from the board.”
The documents went on to allege that when AMA was purchasing repairer Capital S.M.A.R.T, Moore had argued that private equity would generally borrow a greater proportion of funds and “insisted AMA borrow more than the market had indicated was appropriate”. Colinton Capital then later sought that “AMA pay $4.4 million for its part in the borrowing and acquisition of Capital Smart,” the documents said.
While this price was later negotiated and reduced to just over $3 million, the apparent conflict of interest that emerged between Moore, his private equity firm Colinton Capital and AMA infuriated investors, and according to the AFR, the AMA board passed a resolution to stop Moore or any other director “behaving in this manner again”. The documents added that many large shareholders wanted to sell out but were ultimately persuaded not to by Hopkins.
Hopkins originally became AMA Executive Director in December 2015, followed by CEO in November 2018.
AMA: BIZON WILL ENABLE SEAMLESS LEADERSHIP TRANSITION
According to the statement by the AMA Group, Bizon is expected to lead the company on after Hopkins.
“The board is pleased to announce the appointment of Carl,” said company Chair Anthony Day. “Carl is a proven senior executive with extensive leadership skills and experience to successfully lead the business to its full potential. Having been a non-executive director of AMA since February 2019, Carl knows the business well and it will allow a seamless leadership transition.”
“I am excited to be joining the business as Chief Executive Officer,” said Bizon. “As a member of the board over the past year, I have developed a thorough understanding of the business. The business is well positioned to capitalise on growth opportunities, despite the uncertainty created by the pandemic. I look forward to working with the AMA leadership team to deliver continued growth and development of the business.”