CSR managing director Jerry Maycock won’t hang around to pilot the conglomerate’s troubled demerger strategy after a decision to retire next month, with director Jeremy Sutcliffe to navigate the company through a structural separation as well as to fend off a potential takeover from Chinese suitor Bright Food Group.
Only three weeks after the Federal Court blocked CSR’s $3 billion demerger plan due to concerns about its asbestos liabilities, throwing the entire original demerger timetable into turmoil, the company also announced today it would carry out its own internal separation to split building materials and products from its sugar and renewable energy division.
Under a new proposal building materials and Sucrogen - the new name for its sugar and renewables business - will be run as independent units under the CSR public company structure with their own management teams, stand-alone operating systems and individual corporate identities and branding.
‘‘Accordingly it is now intended, so far as legally and practically possible, to operate these businesses as if permanent separation had occurred, providing each business with operating autonomy consistent with that objective,’’ CSR said today.
CSR has sought leave to appeal the Federal Court’s decision, claiming the judgment that blocked the demerger contained errors in law.
There were no details about how the two stand-alone business units would compete for capital and investment funds from the board, but CSR chairman Ian Blackburne said the company had experience in allocating resources.
‘‘It’s not an unfamiliar role for the corporate centre to have to take to allocate capital across the businesses based on opportunity and performance and we can see a model there,’’ Dr Blackburne said.
The process of severing the businesses began last year under Mr Maycock when CSR’s demerger plan was first unveiled to the market.
But Mr Maycock will now depart the company at the end of CSR’s financial year on March 31, keeping to his originally expected retirement date under the demerger timetable.
Mr Maycock took the reins of CSR in early 2007 and greatly broadened the company’s exposure to building products right before a housing slump, spending $865 million for glass businesses Pilkington and DMS Glass.
Mr Sutcliffe has been appointed MD for a period of up to 12 months. He is a former group CEO of Sims Metal Management.
Lurking in the shadows is Shanghai-based Bright Food which made a $1.5 billion offer to buy CSR’s local sugar and renewable energy assets in January. Although CSR rejected the offer Bright is still speculated to be interested in scooping up CSR’s sugar assets as are a pack of other international sugar companies.
egreenblat@theage.com.au
