ASX-listed Endeavour Group (AU:EDV) is undergoing a massive board shake-up aimed at boosting its share price. The company has endured a long-standing tiff with its largest shareholder, Bruce Mathieson, who has roughly a 15% stake. EDV shares gained 2.5% on the news in early trading this morning.
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Endeavour is an Australian alcoholic drinks retailer, hotel operator, and poker machine operator that was spun off from Woolworths Group (AU:WOW) in 2021. Woolworths continues to hold a majority share in EDV. Endeavour boasts some renowned brands, including Dan Murphy’s and BWS.
Further Details About the Board Rejig
Importantly, the board rejig has led to the current Chairman Pearl Hearl’s resignation. Ari Mervis, former CEO of Murray Goulburn, will take over the chairman’s role in April this year. At the same time, billionaire investor Mathieson’s son Bruce Mathieson jnr will also resign from the board effective June 30 and will be replaced by Peter Margin. The arrangement was always in place that Hearl’s resignation would also result in Bruce Mathieson jnr’s resignation.
Mathieson is particularly disturbed about the company’s retailing strategy at Dan Murphy’s brand under Hearl’s leadership. He was displeased that Dan Murphy’s was becoming more of a boutique shop rather than an alcohol superstore under the current management. Mathieson has pushed for Hearl’s resignation at previous board meetings and made failed attempts to bring in Woolworths’ CEO to join the board.
Mathieson is also unhappy about Endeavour’s decision to buy wine companies in the past. EDV shares have lost 11.4% in the past year. With the board shakeup and the possibility of the fallout of the current CEO, Mathieson is hoping that Endeavour’s share price will regain momentum.
Is Endeavour a Good Investment?
With eight Buys versus one Sell rating, EDV stock has a Strong Buy consensus rating on TipRanks. The Endeavour Group share price target of AU$5.86 implies 8.7% upside potential from current levels.
