Founder of scandal-hit travel firm gone, shares stuck
The founder and chairman of a listed travel company reeling from an over-billing scandal at its British subsidiary is retiring with immediate effect.
Jamie Pherous will move into a six-month strategic advisory role at Corporate Travel Management, which he led over 32 years from a small Brisbane agency to one of the world’s largest travel service providers.
CTM was last valued at $2 billion, but its shares on the Australian Securities Exchange have been frozen since August 26 as auditors investigate financial irregularities at its UK division.
The company dismissed its UK and Europe CEO Michael Healy on November 28, before terminating his employment on December 19.
It later announced it would refund Stg77.6 million ($157 million) to several major customers in respect of contracts its UK group executed from 2021 to 2023.
The UK Home Office, which awarded CTM a contract worth Stg 1.6 billion (US$ 3 billion) in 2023 to house refugees and asylum seekers, confirmed that the Australian company had notified it that it had been overbilled in November.
KPMG is carrying out an ongoing forensic audit and CTM said in December it was too early to say whether there was any wrongdoing. None of the company’s leaders have been accused of any wrongdoing.
There is also no suggestion that management at CTM’s Australia-based head office was aware of irregularities in the UK before they were discovered during an audit in August.
Ana Pedersen, CTM’s chief commercial officer, was appointed group managing director and the company began searching for a permanent replacement.
John Snyder, former president and chief executive of BCD Travel, will serve as special counsel during the transition period.
CTM chairman Ewen Crouch said the board, in consultation with Mr Pherous, decided now was the time for new leadership.
“We understand our shareholders’ frustration and disappointment,” he said, adding that the company was doing its best to return CTM shares to trading on the Australian stock exchange as quickly as possible.
Mr. Pherous said he decided it was in the company’s best interest to retire to allow new leadership to focus on the challenges ahead.
Ms Pedersen, who joined CTM in October, said her immediate priority would be to finalize the accounting issues so that its shares, which last traded at $16.07, could be reinstated.
“We are also focused on customer delivery,” he said.
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