David Dearie has been shown the door at Treasury Wine Estates Limited after the company destroyed millions of litres of excess wine in July.
The listed winemaker released a statement this morning advising the market Dearie, who had been CEO since May 2011, would be leaving immediately.
It is understood Dearie was notified over the weekend, once the board finalised its decision after discussing the action on a conference call.
While Dearie played a key role in guiding TWE through a demerger from Fosters Group and establishing its brand, a review after the wine was destroyed determined it was time for a new leader, chairman Paul Rayner said in the statement.
“In particular, having established a solid platform since demerger, the board believes TWE needs a leader with stronger operational focus to deliver on the company’s growth ambitions,” Rayner said.
On 15 July this year TWE announced a write-down of excess stock, which led to it destroying millions of litres of cheap wine in the United States, inviting questions about its sales practices.
“There was a degree of surprise that things had got so bad,” a source with direct knowledge of the situation told Business Insider. “David has more of a marketing and brand background.”
Shares in the worlds second-largest listed wine maker, which produces brands such as Penfolds, Rosemount, Lindemans and Wynns fell 12% on the news to their lowest levels since the company parted ways with Fosters in May 2011.
Warwick Every-Burns, a non-executive member of the company’s board will take Dearie’s place until a permanent replacement is found. “He’s a very safe pair of hands,” the source said.
Every-Burns was a president of international business at cleaning products giant Clorox.
Shares were down 22 cents or 4.63% to $4.53 in early trade. Click this link for a live price.
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