I was fired for telling the truth: Gibbs

Tuesday 29th June 2010

Tony Gibbs says he was "fired" from the board of GPG "for telling the truth", bringing to an end a 20-year association with Ron Brierley.

He was sacked after making an unauthorised statement objecting to the investment company's plan to spin off its Australian assets.

Here's what investors think of the boardroom bust up

Gibbs was notified of the decision on a conference call at 7 pm yesterday, which he says was "quite a sad meeting" and with "a thread of emotion" running through it.

Still, the process was "all handled in a very grown-up way and I am not an unhappy man," he told BusinessWire. "I wish them all the best for the future."

"I must be the only guy ever to have been fired in New Zealand for telling the truth," Gibbs said. "It was a big call to go with what I thought was right or upset my colleagues."

He is "very pleased" to be keeping his role as chairman of insurer Tower and Turners & Growers, two of GPG's biggest investments in New Zealand. Gibbs holds about 10 million shares of Guinness Peat, worth $6.8 million at yesterday's price of 68 cents.

Gibbs's announcement on Friday that he opposed the plan to spin off GPG's Australian assets into a separate listed business was made without the authority of the board, having given his approval for the proposal when it was announced on June 16. But his discomfort predated the announcement and he told BusinessWire he had initially agreed with the plan "for all the wrong reasons."

In announcing Gibbs was dumped as an executive director, chairman Brierley said there had been "increasing difficulties, culminating in last week's serious breach of boardroom protocol." In the circumstances, "there was no alternative to the action taken".

"This action has been taken with much sadness but was unavoidable," chairman Ron Brierley said in a statement today. "Tony was a great achiever for GPG in earlier times and we worked together, closely and effectively, for nearly 20 years."

Instead of a demerger, Gibbs advocated a "material cash distribution" to shareholders before the end of the year and preparation of Coats, its largest investment, for sale. He warned against spending six months and shareholder funds to try to advance the demerger.

Gibbs's departure is a victory for fellow director Gary Weiss, who would take control of the Australian assets once they were spun off. Brierley and Weiss had shared offices in Sydney's CBD.

Still, Brierley announced the appointment of three independent, non-executive directors to the board with a mandate to review the demerger plan and consult with shareholders.

Brierley said Gibbs's alternative plan "fails to take account of the complexities inherent in GPG's current structure." The group also had to deal with tax complexities across various jurisdictions and Coats, while on the mend, isn't at the stage to be sold via an initial public offering.

Brierley said the remaining executive directors won't participate in any decisions by the board relating to the restructure.

"My sole objective remains optimising value for GPG shareholders and I believe GPG's current business needs to be simplified and streamlined to enable this," he said.

What investors think of the the Boardroom bust up

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