Insights

Could this finally save the Myer (ASX:MYR) share price?

The Myer share price has responded well to the resignation of chair, Garry Hounsell. Yet, major shareholders still want more change.
The post Could this finally save the Myer (ASX:MYR) share price? appeared first on Motley Fool Australia. –

falling asx share price represented by woman falling through mid air

Hours before the Myer Holdings Ltd (ASX: MYR) AGM yesterday, the chair, Garry Hounsell, retired from the ailing retailer. Mr Hounsell had been under intense pressure to resign by Solomon Lew, chair of  Premier Investments Limited (ASX: PMV). The Myer share price increased 2.17% by the close of business yesterday. In addition, at the time of writing, it has already risen by 4.35% in early trading today.

The decline of the Myer share price

With 10.8% ownership of Myer, Premier has long been a critic, indicating it would vote against re-election of the chair. However, the deciding moment came when Wilson Asset Management, with 7.8% ownership, also indicated it would vote against the re-election. Nonetheless, the Premier chair has continued his criticism, saying in a statement.

Mr Hounsell’s ousting signals to the entire board that their time is up.

In the interests of all shareholders, we expect the remaining Myer directors will now indicate their intention to step aside in an orderly manner or face an extraordinary general meeting at which they will be certainly dismissed.

For the sake of all of Myer’s dedicated employees, its many hardworking suppliers, its loyal but frustrated customers, and of course its long-suffering shareholders, the company needs to be restored to health by installing a new, independent board.

In its annual report, the Myer board announced a statutory loss for FY20 of $172.4 million last month. This was the second largest loss in the storied company’s history. Consequently, the Myer share price entered a period of volatility. Mr Lew has been calling for the resignation of the entire board since then. Wilson Asset Management chair, Mr Geoff Wilson, has stated that the company should revisit the number and remuneration of its directors.

Mr Hounsell’s resignation comes after two other directors had already confirmed in September they would not seek re-election on pressure from Mr Wilson. The salaries of the board had also been reduced. However, Mr Wilson was seeking further discussions on remuneration for directors of a company with a market capitalisation of $190 million.

What happens next?

Mr Wilson has indicated that he doesn’t support an extraordinary general meeting for a full spill of the board. Moreover, Mr Wilson has previously allied with other large shareholders to resist Mr Lew’s 2018 attempt to roll the board. 

Acting chair, JoAnne Stephenson, a former KPMG partner, called for unity during the AGM. The company is fast approaching its peak season during Christmas, and Mr Wilson in particular believes tipping the entire board out at this time would prove too disruptive. Ms Stephenson believes it is essential that the management team is able to focus on the period from Black Friday through to the January stocktake sale. 

The Myer share price has been in inexorable decline for over a decade. Chief executive, John King, continues to negotiate with landlords to reduce floor space by at least another 60,000 square metres.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Could this finally save the Myer (ASX:MYR) share price? appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!