Insights

Humm share price tumbles 4% as majority of board exits

All bar one of the Humm board will walk away after the sale of its BNPL division failed.
The post Humm share price tumbles 4% as majority of board exits appeared first on The Motley Fool Australia. –

The Humm Group Ltd (ASX: HUM) share price is plunging amid news five members of the company’s six-person board have resigned in the wake of the termination of a planned $250 million sale.

The sale was vehemently opposed by Humm founder, director, and largest shareholder Andrew Abercrombie – who the resigning members of the board now reject working beside.

The Humm share price plunged almost 4% to 50.5 cents in early trading today before regaining ground to 51 cents at the time of writing.

For context, the broader market is in the green on Wednesday. The S&P/ASX 200 Index (ASX: XJO) is currently up 0.168% while the All Ordinaries Index (ASX: XAO) has gained 0.12%.

Let’s take a closer look at what might be weighing on the finance and buy now, pay later (BNPL) provider’s stock today.

Humm share price slumps amid board resignations

The Humm share price is sinking on Wednesday. Its tumble comes after the company announced its chair and all directors – except Abercrombie – are stepping down.

It follows last week’s news that the sale of Humm’s BNPL business to Latitude Group Holdings Ltd (ASX: LFS) had fallen through. Its termination was said to be due to “major disruption in financial markets”.

“The events leading to the termination of the proposed sale of Humm Consumer Finance to Latitude Group Holdings Ltd (ASX: LFS) … have caused the majority directors of Humm … to conclude that they cannot remain on the board of directors with Andrew Abercrombie,” the company said in a release to the ASX this morning.

The release detailed the immediate resignation of directors Alistair Muir and John Wylie.

Meanwhile, Humm chair Christine Christian and directors Carole Campbell and Rajeev Dhawan will resign when replacement directors are appointed.

The company noted the gradual handover would allow the company to “deal with the challenges and opportunities ahead”.

Abercrombie labelled the now deceased deal – that would see the company’s BNPL leg sold to Latitude – a “dud” and “nothing but a garage sale”.

That’s despite Humm noting the business hadn’t turned a profit in 2022 and risks the company’s share price.

Board unanimous ‘excluding one lone dissenting director’

The board further outlined its position regarding the failed sale in a letter to shareholders last night that accused Abercrombie of undertaking “a strident campaign against the proposed sale”. The board went on to say:

The majority directors have been prepared to act to secure [the sale] despite multiple aggressively worded private threats of legal action against us personally from Andrew Abercrombie.

[T]his was the entire board of highly experienced people acting unanimously in all these decisions, excluding one lone dissenting director.

Humm’s stock has struggled this year. It has fallen 45% year to date. It’s also 50% lower than it was this time last year.

The post Humm share price tumbles 4% as majority of board exits appeared first on The Motley Fool Australia.

Should you invest $1,000 in Humm Group Ltd right now?

Before you consider Humm Group Ltd, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Humm Group Ltd wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

See The 5 Stocks
*Returns as of January 13th 2022

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

Why Block, Fortescue, GUD, and Humm shares are sinking today
Latitude share price lifts on cancelled Humm deal
Humm share price sinks 11% following termination of $250m BNPL sale to Latitude
Why Humm, Inghams, Link, and Smartgroup shares are falling
‘A dud deal’: Why is the Humm share price falling on Thursday?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Humm Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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.

  • This field is for validation purposes and should be left unchanged.

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

Share With Your Friends

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, 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.

FREE AAPL, TSLA, AMZN, PFE or MRO Share(s)
REGISTER TO BE ELIGIBLE FOR FREE SHARES
TRAVEL ACROSS THE FINANCIAL WORLD
Act Fast - Promotion Ends In
Click Here To Get Started
FREE AAPL, TSLA, AMZN, PFE or MRO Share(s)
REGISTER TO BE ELIGIBLE FOR FREE SHARES
TRAVEL ACROSS THE FINANCIAL WORLD
Act Fast - Promotion Ends In
Click Here For More Info