I will never understand why supposedly "smart" men of his ilk fall for the three vices Uncle Warren warned about - Leverage, Liquor and Ladies.

@karlrockdrain It looks like RW is paying to have this case go away?

From the ABC:

Legal stoush between WiseTech's Richard White and Linda Rogan has been finalised

By Gareth Hutchens

The legal stoush has been discontinued

According to the Federal Court, the bankruptcy fight between Richard White, the billionaire founder and CEO of Australia's biggest tech company WiseTech, and Linda Rogan, the Sydney wellness entrepreneur, has been discontinued.

More to come I am sure

Yes. This was the most straightforward and obvious option, but it may already be a little late in the day for him - more details of his sordid behaviour and associated allegations have already been rife in the press.

Yeah thanks @thunderhead its doesnt strike me as a screaming buy, just yet, but certainly looking more attractive than last week. Re the allegations made, this has a ways to go before its sorted out.

Thanks @mikebrisy While the allegations are serious and seemingly numerous, surely it shouldnt affect the day to day operations of the company itself. Surely he needs to step aside, at least in the short term. This is starting to drag on. There will surely be pressure on him now that the SP has actually fallen.

Fascinating to watch how this gets handled.

This is tough one. As with Chris Ellison and Mineral Resources, the circumstances with Richard White do offer insight into his character. The question is whether his (alleged/perceived) relationship indiscretions reveal a propensity for business impropriety, as (potentially) seems more apparent in the case of Chris Ellison.

I dunno!

Should I care if an effective CEO happens to be a bit of a pig in terms of his personal relationships? He hasn't come across well in terms of what has been reported, but at the same time he hasn't broken any law. And I doubt it will have any lasting impact on the business.

I tend to agree with @mikebrisy -- any change of leadership could be a risk. So i'm also on the sidelines for now.

@Strawman I read a suggestion this morning that super funds and the like, that hold WTC, will be keen to sort this out ASAP in line with their ESG policies.

As you point out, he is being scrutinised for behaviour out of the public domain. It gets a little blurry if one is using their position and office to manipulate outcomes, even if no laws have been broken. It may not go well in the court of public opinion.

Perhaps I am jumping the gun a little, however, It will be interesting to see how far he is willing to go to maintain his position. If I were a 69 year old billionaire, I might find something else to do with my time. But sometimes ego gets the better of us all.

@Arizona I'm not a technical or momentum trader (what I know about these things can be written in 2 or sentences, and it probably wrong).

I was first aware of the issue bubbling up on 2 October, when I read about it in the press. The stories were updated pretty much daily, with new details and new cast members, and I wondered when the markets would start to take notice. (On 2 October, when I read the article in the Australian, I recalled another article from earlier this year, which I have cited below, and I thought to myself "interesting...")

It wasn't until Wednesday 16th October that significant volumes and a downward price movement started to materialise. (Although there was a small tick up in short positons on 3-Oct, which appears to have steadily reverted to the "pre-disturbed" level.)

But from 16th and 17th, when news began to break that the Board was involved, the volumes have ramped up, Today's 3 Million shares traded is a volume only seen when Richard does his sell downs (I think).

So, what do the technical experts say? Is this a downtrend of an, arguably, very highly rated stock? Or does it allow big investors on the sidelines to take a position?

From my understanding, the Market doesn't like uncertainty. So, what are the uncertainties? Here are some questions, ... perhaps there are others.

1. Is this the end of the salacious newsflow? (a new case today)
2. Will more information and/ or cases emerge that move this from questionable personal behaviour to something more serious?
3. Will the Board stand Richard aside whether for his "mental health" or to allow him to deal with personal issues and not be distracted from running the company?
4. If yes to 3., who will be the Acting CEO?
5. What are the major institutional investors saying to Dammery? (With 23% wiped off the SP, that's $10bn, there are going to be conversations.)

This appears to be consequential.

Will questions over management ethics/behaviour result in an ongoing re-rating of this highly rated stock? (ESG) Or will it all die down over coming days and weeks, and we'll all look back and realise that this Rock'n'Rol' Tech Guru may well have a colourful personal history that weaves in and out of his business life and dealings. After all, on March 12th, he was reported in the Australian in discussing his relationship with co-founder Mqree Isaacs as follows:

“When I came in to do their computer work [Triple M] it was Maree that I met,” White says. “I did a number of service calls there, and we became friends, and then a bit more than friends for a time. And then I eventually convinced her to leave Triple M.”

Perhaps it was always in plain view? (What is the definition of a "service call"?)

FWIW: if I was the Chair (recognising that I am not and I haven't heard RW's side of things) I would ask him to stand aside and install an Acting CEO. The reason is that if "more" unfolds, and if further facts reveal a more troubling picture, then to have not acted could - with the future benefit of hindsight - be deemed to have not been in the best interests of shareholders. But then again, if the Board stands RW aside, how will the market react? His steadfast vision and discipline in the execution of the strategy is the reason why, until a few days ago, $WTC was worth $45bn. He is also, by far, the largest shareholder (37%). I don't think it is an easy call. And so, I think the voices of big shareholders will weigh significantly in the decision Dammery takes.

Two points on this - Firstly... Deleted - not relevant - was actually about MinRes (MIN).

Second point: Richard White sold $61.4m worth of WTC shares on-market between October 3rd and October 10th @ $132.89 per share (average price received) followed by another $46m worth of WTC shares on-market between the 11th and 17th October @ $131.22/share (average) and then we have the media reports about his behaviour and then this today (21st Oct): Response-to-Media-Reports.PDF and the WTC SP got as low as $100.02/share and closed at $104.65.

They say there a lot of reasons why insiders sell shares but usually only one reason why they buy shares. White, as founder of the company, and its CEO and its Managing Director, hasn't been buying his WTC shares over the years, they have been accumulating via management incentives and remuneration, as well as director remuneration, and he got most of them through being the company's founder obviously, and in this case, the reason why he has sold over $107 million worth of shares this month - so far - is clearly because he viewed the revelations that were about to be shared with all shareholders via the ASX announcements platform as being very likely to have a detrimental impact on the WTC share price. And they certainly have.

So, this selling might have been a red flag. Trouble is, he has sold down shares consistently over the journey, to fund his lifestyle no doubt, so these latest sales might have been viewed as "more of the same" - or normal behaviour as opposed to unusual behaviour.

White still owns just under 115 million shares, which is between 36% and 37% of WTC, and even at $100/share that's circa $11.5 Billion - so even if he steps down from the Board, which is a big "IF" indeed, he is still the majority shareholder of the company, so it's not like he's not going to have a say in the way the company is run. It will still be Richard White's company, any way you look at it.

My main concern with WTC over the years, especially a few years ago, was the pace of the acquisitions, and the sheer number of acquisitions, and I remember being somewhat comforted by White's assurance that he had personally developed a very succesful and repeatable framework for the integration of acquisitions that all but guaranteed that there would be no significant hiccups or noteworthy digestion issues with these acquisitions, such as cultural differences, or some of them just not being a good fit. The theory was that they were mostly bolt-ons that simply added geographical capability and know-how, plus more customers, so they were necessary to plug local geographical (country) knowledge gaps or coverage, however I always did have a nagging feeling that it just could NOT be that simple to keep buying more and more companies and seamlessly integrate them into your own company without issues, particularly when some of these companies didn't even come with people who spoke English. When that short report came out I thought, "Ahh, the unravelling begins...", but I was wrong and they bounced right back from that, as the report itself was fairly baseless.

So my concerns about the sheer number of acquisitions apparently were misguided or at least my fears around the risks of that did not pan out in a negative way as I had half expected, so I then figured, well, at these prices that's just another one that got away from me, move on.

However this isn't something I had seen coming at all. Not that I follow them closely.

However, I rode Magellan Financial Group (MFG) too far down after Hamish Douglass imploded, and I lost more money on MFG than I otherwise would have lost because of holding on far too long and buying more as they fell. While I did always recognise and appreciate that key-man risk with Hamish being the driving force behind MFG, I also thought the business was capable of doing well without him. What I failed to consider was that (a) the reason why MFG was a market darling back in the day was mainly BECAUSE of Douglass and his apparent Midas touch, and that without him, confidence levels in MFG as a funds management company evaporated along with their rapidly declining FUM as more and more people took their money out of MFG's various funds, and (b) I also failed to appreciate (b1) the number of side hussles that Hamish had taken MFG into, some of which played out well - like the pre-IPO Guzman Y Gomez investment and the absorption/acquisition of Airlie Funds Management - so Australian instead of the global investing that their reputation was built on - and some that did not, plus (b2) the big bets that Hamish had made on two very large Chinese companies - Alibaba and Tencent - which he bought near the peak and doubled down on after they started falling, and refused to acknowledge his mistakes until those two positions were down by hundreds of millions, possibly billions of dollars.

Hamish had outperformed Kerr Neilson at Platinum BECAUSE he had steered clear of China and focused almost exclusively on American tech primarily, plus fast food franchises (MacDonalds, Yumm! Brands, Starbucks, etc), and dominant financial companies (like Mastercard and Visa) to a lesser extent - Hamish' ex-Magellan-business-partner and Magellan-Financial-Group-Co-founder Chris Mackay held a lot higher weightings to Visa and Mastercard in his own fund (MFF) than any of MFG's funds did - coz Mackay had a much more sensible risk tolerance than Douglass. Kerr Neilson's Platinum funds were underperforming because they favoured Asian companies over many US companies because they thought there was more value in Asia and the NASDAQ looked overvalued, and MFG took the other side of that argument and played the momentum game rather than the traditional value investing approach of Platinum.

That all played out swimingly for Hamish at MFG until a few of those positions, like Facebook, Netflix, Alibaba and Tencent all fell significantly around the same time, for different reasons - Netflix because of much more competition and declining growth, Facebook over privacy breaches and governance concerns along with expected regulatory impacts (that never really had any significant financial impact on FB, but the whole "Meta-focus" did change the narrative and the value proposition for sure), and the Chinese companies because of their central government crack-down on their own tech billionaires who were getting a little big for their boots including Jack Ma daring to question a couple of government policies in a speech, just before he disappeared for many months.

One of the biggest things that signalled that Xi was clamping down on Chinese billionaires like Jack Ma was in October 2020 when the Ant Group spin-out (IPO) from Alibaba was set to raise US$34.5 billion in the world's largest IPO at the time, valuing the company at US$313 billion, and on the eve of the IPO, China stopped the process from moving forward. It was reported that the Chinese Communist Party leader Xi Jinping personally scuttled the Ant IPO.

https://www.cnbc.com/2020/11/03/ant-group-ipo-in-shanghai-suspended.html [Nov 2020]

And: https://www.forbes.com/sites/georgecalhoun/2020/11/08/why-china-stepped-on-the-ant-group-part-1-a-bubble-looming/

And: https://www.forbes.com/sites/georgecalhoun/2020/11/16/why-china-stopped-the-ant-groups-ipopart-2-ants-dangerous-business-model/

And: https://www.scmp.com/tech/big-tech/article/3227753/timeline-chinas-32-month-big-tech-crackdown-killed-worlds-largest-ipo-and-wiped-out-trillions-value

While Ant Financial (Ant Group) did later IPO, there have been subsequent stumbles like this: https://www.asiafinancial.com/shock-reversal-on-cloud-unit-wipes-20bn-off-alibaba-shares [17-Nov-2023]

"Alibaba’s shock decision to scrap the planned spin-off of its cloud business sparked a sharp sell-off in its share price, effectively wiping $20 billion of its market value."

That was the day 1 market reaction to that latest hiccup, and that was less than a year ago, so I still regard Chinese companies as uninvestable. Tencent also had problems, just not as massive as the Alibaba ones.

Thing is, Hamish Douglass at MFG decided to jump onboard the Chinese Tech train at pretty much exactly the worst possible time after saying for years that he saw less risk in the USA and was happy enough with US Tech exposure.

I'm so far off track here that I can't even see the tracks, so I'll snap my fingers and be back discussing WTC again.

Ahh, that's better. So with Richard White (I almost said "Walter White" but that's a totally different area of questionable behaviour) we also have massive Key-Man Risk, as others have identified already here, so I'm not tempted to load up on WTC here because I don't know how that Key-Man Risk is going to play out. I underestimated the impact with MFG, burned thousands of dollars as a result, and I don't want to make the same mistake again, despite the quality of WTC as a company and their enviable industry position and significant future growth runway.

Additional:

The following day I did a 180 and bought WTC in my SMSF as well as here on SM. What changed? Richard White settling out of court is what changed. And "sleeping on it" as well. Short version is I made a call that the key-man risk was NOT playing out negatively at this point IF RW remained within WTC performing the same role, which it looked like was going to be the case after the case was settled. Still plenty of key-man risk there, but it looked like the worst-case scenarios had been averted.

Some people may think this is a bit of "Poop and Scoop", which is the opposite of "Pump and Dump", i.e. me talking Wisetech down on Monday and then buying them on Tuesday at lower prices, however it's not, it was me explaining my thought process on both days, and my thought process did change, and also: I could have bought them cheaper on the day I was talking them down (Monday), and did not, I instead bought them the following day at higher prices; they rose +2.84% on Tuesday, the day I bought them, then fell on Wednesday and are on track to fall again today (Thursday 24th October, 2024), so from a timing POV I did poorly.

But just wanted to set the record straight - I still believe that key-man risk is significant with Wisetech, but I've bought some anyway because I think the risk has decreased with the case settlement and the fact that no evidence thus far has linked RW's behaviour to any financial impact on Wisetech. In other words, in my MFG example, Hamish Douglass made some bad calls and exhibited regrettable behaviour that certainly did directly impact MFG's profitability as well as their share price - behaviour such as refusing to accept that he'd made bad calls with large bets on Alibaba and Tencent at the worst possible times - until hundreds of millions of dollars of investment dollars had been lost, but RW's only negative impact on Wisetech has been the share price decline recently, which is actually a positive if you're a buyer rather than a seller. My opinion would change (yet again) if further evidence emerges that goes beyond RW's private life and involves impropriety that has financially impacted Wisetech directly - other than just moving their share price.

Id be shocked that this leads to a CEO change and it would be a huge negative IMO.

I've always understood $WTC to have a good culture, that fosters sharing, agility and encourages people to deliver solutions that solve customer problems.

Part of its success has been to identify customer problems, and then to develop CargoWise to deliver value to customers by taking the friction out of the logistics processes. This is massive, given the amount $WTC spends on R&D, and how its ability to develop the platform is a key driver of adding value to customers, and thereby being able to increase prices time and time again, because the software makes the client's business better and more efficient.

But how good is the cutlure, really? And how much does it depend on RW as the leader? (Glassdoor gives him 85% employee favourability rating, which is pretty good.)

Glassdoor CEO ratings of >90% are considered exceptional and are rare. (Sukhinder Cassidy ($XRO) has 68%; Rob Scott ($WES) has 74%; Owen Wilson ($REA) has 82%; Matt Comyn ($CBA) has 87%; Shemara Wikramanayake ($MQG) has 90%)

To get a view on culture, I uploaded the last 30 reviews from Glassdoor to my BA Claude.AI and asked Claude to provide an assessment of culture, based on the employee reviews. I restricted the data to 30 reviews, just to capture the last year.

Here's what came back.

Interesting.

------------------------------------------------------------------------------------------

Report by Claude.AI

Based on the employee reviews provided, I can summarize the apparent culture of the business as follows:

Positive aspects:

1. Strong emphasis on work-life balance and flexibility, with a hybrid working model that allows for remote work.
2. Generally positive and friendly work environment with supportive colleagues.
3. Focus on mentorship, knowledge-sharing, and professional development, especially for junior employees and new graduates.
4. Diverse and inclusive workplace with a global presence.
5. Good perks, including free food and competitive salary packages in some locations.
6. Opportunities to rotate between teams and explore different areas of the company.

Negative aspects:

1. Outdated technology stack and reluctance to adopt new technologies or open-source solutions.
2. Micromanagement and top-down decision-making, particularly from the CEO (Richard), which can stifle innovation and idea-sharing.
3. Slow career progression and limited opportunities for advancement in some areas.
4. Large, complex codebase that can be challenging to work with.
5. Inconsistent salary competitiveness, with some employees feeling underpaid compared to market rates.
6. Bureaucratic processes and slow decision-making in some instances.

Mixed opinions:

1. Company culture is generally viewed positively, but there are some reports of toxicity, particularly related to upper management.
2. While many appreciate the learning opportunities, others feel there's not much to learn due to the outdated tech stack.
3. The company appears to be growing rapidly, which brings both opportunities and challenges.

Overall, the culture seems to be one that values work-life balance and employee well-being, with a strong focus on mentorship and development. However, there are significant concerns about technological stagnation and a management style that may hinder innovation and employee empowerment. The company appears to be at a crossroads between its startup roots and its current status as a larger, more established organization, leading to some growing pains in terms of processes and decision-making.

With such a substantial shareholding, I can't see a leadership change. Even if almost everyone hated him, he only needs (14/63)= 22% of non-him shareholders to accept the status quo.

I don't know why he does what he does, or did what he did. But it does seem bizarre that he's letting this play out publicly over such a trivial (for him) financial issue - which may speak to either a lack of insight or a belligerent desire for justice (depending on one's point of view)

Disc: I acquired RL today; have been on the sidelines for some time and accepted a discount on a quality firm in exchange for some key person and management risk.

@Solvetheriddle I agree.

But would your level of shock be the same if it was announced that he was taking leave of absence for, say, 3 months to resolve his personal issues. (Specifically to resolve the court case, which would also allow time for any other issues to come out of the woodwork).

So far there is only one legal case regarding the property, and his hand in pressing the bankruptcy of his ex-lover, as I understand it. The other cases at the moment appear to be purely personal relationship matters.

It is not unheard of for a CEO to take some time out to resolve a personal matter, and then to return to their position.

Once again, I turned to my BA to dig up some examples of CEOs who have temporarily stepped back from their roles:

Report

Author: ChatGPT Position: BA to mikebrisy

Here are 20 CEOs who have taken leave to deal with personal issues (excluding maternity leave and health matters) and then returned to their positions:

POST EDITS

• I've removed the list of CEOs from here from my AI search. While some are certainly correct, there are others where I think the AI has confused announcements about contract renewals and departures with the Executive actually taking leave. So, I don't have confidence in the list, and I think it better to have removed it.

END OF POST EDITs

These examples show that CEOs often return to their roles after resolving personal matters, highlighting how companies value continuity in leadership when the CEO’s absence is not due to performance or health issues.

@mikebrisy The board really must be between a rock and a hard place now.

An unenviable position for sure.

I think your questions are all highly relevant and are exactly the kind of questions be asked by observers far and wide.

@Aaronfzr Bizarre exactly! Why over $90K ?

Surely any advice he got would have suggested he cough up and move along. I am sure there is more to the story and we'll find out in time.

Congrats on becoming a shareholder. I hope it plays out nicely.

Not held.....yet.

@Bear77 A relevant and detailed position you put here.

While you may have gotten "off track" as you said, with Jack Ma and Hamish Douglass etc, In doing so you to painted a vivid picture of key man risk.

If this doesnt simply die down, there are some challenging waters to navigate. But what would I know.

@mikebrisy I read your list of CEO's who temporarily stepped down.

To me it makes sense that any of us would need to step down at one time or another CEO's included. I feel that in society today the idea that a CEO might step down for a period is not radical at all. So that is all on his side.

However, the list your BA provided is centred around the US. Billionaire founders/CEO's are harder to come by here and I wonder if, given Australia's tall poppy syndrome and our media, would he be given the same understanding as our brothers and sisters overseas.

Just a thought.

@Arizona its a fair point, I’m forever coaching my BAs to not be so US-centric. But when you’ve done your MBA there and most of your prescribed readings are from the HBR, they tend to get into a mindset that the civilised world begins and ends with the Lower 48.

They are off the clock now, so I may take a look at this tomorrow. (When I was a BA the idea of knocking off before 7pm on a week night was anathema!)

That's a pretty illustrious list there!

I've thought about this a little more, and extended my narcissism to try to explain this situation. Surely every lawyer he never even met told him not to bother with this. I have 2 hypotheses regarding RW's motives.

1) This is about his primary romantic relationship, and he is doubling-down legally and financially in order to defend his relationship against harmful allegations. He doesn't care about the outcome in the court's eyes, but does care about his response to the allegations is perceived. In this circumstance, the outcome is irrelevant and tangential to a desired outcome.

2) The other party has attempted blackmail against RW, with the threat to reveal even-more damaging information if the case goes to court. RW, believing that blackmailers and bullies can never be fully bought-off, and is litigating with the expectation that beans will be spilled. By going to court, he is hoping to discredit potential allegations as nothing but gutter trash. In this circumstance, further, more damaging information may yet follow.

You’re wasted as an anaesthetist. Psychology is your true calling

Magellan and Wisetech is probably not a good comparison

With Magellan, it is easy peasy switching out to another fund or even an ETF.

Wisetech maybe not so easy especially when an organisation has started using their software, it is difficult to go back. Switching cost will be high.

So I'm keeping an open mind on this.

I'm not suggesting that this will impact Wisetech's sales @edgescape . On that level their customers / clients don't care what RW does. I was talking about it in terms of investors, not customers. Yes, I did mention MFG losing FUM as part of that death spiral they were in for a while (they pulled out of it before they hit the ground of course) but that was as much to do with MFG's various funds moving from consistent outperformance to consistent underperformance relative to their benchmarks as it was with concerns over Hamish losing the plot and then leaving the portfolio management to others.

I was only really trying to give an example of where I had underestimated the share price impact of key-man risk with MFG. I don't think this will have much effect on Cargowise's market share, being the software that Wisetech is built around; I have no concerns about that - they will remain best in breed and, like I said, their customers aren't interested in the private lives of their suppliers' management. My concern over the key-man risk with Wisetech is around how much of a management premium has been built in to the share price because of Richard White's superb execution to date, and if that premium could evaporate or even become a discount if he is no longer in that role, even if that is only a temporary hiatus - which do sometimes become longer than temporary - as happened with Hamish Douglass.

@mikebrisy The excelllent list you provided is full of "Unicorns" - to be expected. In some respects RW is an even rarer beast - The Australian Unicorn is harder to find in the wild and often preyed upon by bloodthirsty media packs.

An Australasian list might be a little lighter in terms of big hitters and possibly numbers overall.

@Arizona I have asked all three of my BAs to do this analysis for Australia, but I don't have confidence with what came back. So the Australian list indeed looks small. I was a bit more rigorous in this review, because some of the US cases didn't align with my recollection of some of the leaders. So I doubt the veracity of the list of 20 US CEO's I gave yesterday. I think my BA's might be confusing statements about communications on intention to stand down in future, with taking "leave". I've sampled several results and done a deeper dive, and found factual errors! I feel so strongly about it, I am going to edit the post - as I don't like posting on this forum information that I think is more likely to be wrong than right!

On this subject, RW is 69, turning 70 in December. While in this day and age, plenty of CEOs continue on well past that age, if the Board was doing its job, there would be a robust succession plan in place. We haven't heard about that yet (investors rarely do), as far as I am aware. Dammery has been there long enough now that the Board WILL have had a discussion about succession planning. If RW were to step aside for a few months and sort out his personal issues, it gives the Board the chance to test an internal Acting CEO. So, more than one reason to give this a go.

When I was a senior manager at a UK FTSE-20 company over a decade ago, the Board ran a 3+ year succession process monitoring the suitability of three internal candidates. They ended up picking one when the CEO retired. The individual turned out to be a poor choice, and then shortly thereafter they brought in an external, well-credentialled CEO. I only cite this example, to emphasise that CEO succession management is a core Board responsibility. Dammery is experienced enough to be on top of this. The issue, as pointed out by others, is what can he do if RW's 37% voting weight (and his supporters), are against it? And, also, as others have said, how does the "founder, rainmaker" premium balance with the "ESG discount"?

A key point - which we cannot know - is what RW has revealed to the Board about his side of the story and what more, if anything, is yet to emerge. You'd expect RW to be candid with the Board, because if he misleads the Board and more comes to light so that the Board considers they were misled, then that would be a whole new level of escalation.

Of course, if RW is such a legendary figure within the company (think how much stock employees have; how many of the tech talent have benefitted and are benefitting from the study while working scheme) then of course, over time, this issue can directly effect employee motivation, productivity and retention, as well as culture.

Because the stakes are high, I expect Dammery to do a good job. If, based on his investigations, he assesses that it is likely that this is going to simply be a case of salacious reports about RW's colourful personal life, that there was no illegality AND that there has not been any inapprorpiate behaviour involving $WTC assets or stakeholders (employees, suppliers, customers, investors etc.), then I imagine he might choose to ride out the storm and leave RW in place, particularly if RW is against the option to take some leave. So I think a big part of this relies on the quality of disclosures between RW and the Board. RW is smart, ... surely he'd calculate the best way to protect his own investment is to be candid with the Board?

Dammery will earn his fee as Chair during this process. Finely balanced calls are involved, with a significant impact on shareholder value in the short and medium term, as a minimum.

@mikebrisy Thanks for humouring me on the Australian search. This is fascinating on a number of levels, not the least of which is your employment of AI and then the subsequent questions around veracity and accuracy of the results. There is so much to talk about and understand there. Kudos to you for digging a little deeper and uncovering potential errors.

I agree that RW's age is a concern. It's not a topic I was keen to jump on in this kind of forum as I like to see age as just a number. I know people much older than he, who are very capable and switched on and have met folks much younger who aren't doing so well. Perhaps it's not his age per se, as much as my concerns would be around his biological age. Ie: he does'nt strike me as an overly healthy individual. Healthy body, healthy mind and all that.

So even if the scandals subside tomorrow, the health/age issue remains looming down the road a little and he has drawn attention to himself and will be scrutinised as a result - just my opinion.

On one hand he has been doing what ever he does in his private life - none of my business. However if he was switched on, we wouldn't know or be talking about these things. Something is not working as it should.

"Finely balanced calls are involved" - you say. I couldn't agree more.

24-Oct-2024: WTC falling again today - now below $100/share at 2pm Sydney time. Earlier in this particular forum thread I said that I was NOT tempted to buy WTC despite their SP fall - because of the significant key-man risk there, and having re-read this entire thread, I realise I did not then explain why I went ahead and bought WTC the following day (Tuesday) - so I've modified that earlier post now to include the following:

Additional:

The following day I did a 180 and bought WTC in my SMSF as well as here on SM. What changed? Richard White settling out of court is what changed. And "sleeping on it" as well. Short version is I made a call that the key-man risk was NOT playing out negatively at this point IF RW remained within WTC performing the same role, which it looked like was going to be the ongoing situation after the case was settled. Still plenty of key-man risk there, but it looked like the worst-case scenarios had been averted.

Some people may think this is a bit of "Poop and Scoop", which is the opposite of "Pump and Dump", i.e. me talking Wisetech down on Monday and then buying them on Tuesday at lower prices, however it's not, it was me explaining my thought process on both days, and my thought process did change, and also: I could have bought them cheaper on the day I was talking them down (Monday), and did not, I instead bought them the following day at higher prices; they rose +2.84% on Tuesday, the day I bought them, then fell on Wednesday and are on track to fall again today (Thursday 24th October, 2024), so from a timing POV I did poorly.

But just wanted to set the record straight - I still believe that key-man risk is significant with Wisetech, but I've bought some anyway because I think the risk has decreased with the case settlement and the fact that no evidence thus far has linked RW's behaviour to any financial impact on Wisetech. In other words, in my MFG example, Hamish Douglass made some bad calls and exhibited regrettable behaviour that certainly did directly impact MFG's profitability as well as their share price - behaviour such as refusing to accept that he'd made bad calls with large bets on Alibaba and Tencent at the worst possible times - until hundreds of millions of dollars of unit-holders' funds had been lost, but RW's only negative impact on Wisetech has been the share price decline recently, which is actually a positive if you're a buyer rather than a seller. My opinion would change (yet again) if further evidence emerges that goes beyond RW's private life and involves impropriety that has financially impacted Wisetech directly - other than just moving their share price.

@Bear77 nice clarification, and it looks like we have both gone through related thought processes. (FWIW, I didn't perceive your evolving thoughts as a Poop and Scoop. In any event, it's irrelevant, as I don't think this forum has the weight to move the SP of a business as large as $WTC - one reason why I am totally happy to be transparent and think aloud on the forum.)

Given the continuing downward price movement, we're starting to head towards the lower end of my August-updated valuation range: $103 ($92-$123). Having repurchased about 60% of the number of shares I sold close to peak prices, normally as the SP descends on momentum back towards the lower bound of my valuation range, I would pick up the remaining part of the position, and then some in terms of share count.

While I don't consider I have a sufficiently-informed basis to update my valuation, I do have a new perception of risk, and so I am going to think very carefully about further increasing my position as the SP continues to fall - which I believe it will until the Board communicates on the invesitgation and succession plans. (This is one of the learnings I have made from some of my historically bad decisions, albeit, these were in companies of much lower quality that $WTC, and involved stupidly outsized positions. Over 8 years as my portfolio has grown materially, I've learned to be a damn sight more careful with my hard-earned $!)

That said, once the Board clears the air, I believe the SP could rebound sharply. So, on the asumption that these kinds of investigations take weeks to see through to completion, and assuming the interviewing process only got under way a week or so after 2-October, we might not hear anything for a while. So, with the media hounds out there chasing to be first to break the next story, every day that goes by without a new revelation contributes to improving the risk profile.

I'm sticking to my valuation for now, because I truly believe that the long term prospects, value, and multiple of $WTC are unchanged by the current noise, even given the c. 25% chance (I agree with Morningstar) that we see a CEO change over the coming weeks or months.

However, I am also likely NOT going to add back my full position and more, because I remain open to the risk of additional adverse newsflow. The sweet spot for me would 1) ongoing downwards SP momentum and 2) no new adverse news, reducing my assessment of risk.

That's MY current thought process.