Why the TPG share price plunged on Friday
The TPG share price was down firmly in the morning session after the company revealed that David Teoh would be resigning as Director and Chairman of the Board.
What happened
The telecommunications company on Friday announced that David Teoh would be as director and Chairman of TPG's board, effective March 25.
In his place, Canning Fok is set to take on the role of Director and Chairman, effective March 26.
It was revealed that Shane Teoh had also resigned from the Board.
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How we got here
These high-level departures cap off a momentous period for the telecommunications giant.
- In 2018 TPG announced it intended to merge with Vodafone.
- Australia's consumer watchdog (ACCC) attempted to block the merger, saying that consumers would suffer with three telecoms providers instead of four.
- TPG appealed the decision in federal court and won. With Justice John Middleton at the time saying 'It is not for the ACCC or this court to engineer a competitive outcome.’
- In July 2020 the Vodafone formally merged with TPG – with the merged company trading as TPG Telecom Limited (ticker: TPG).
The key players
David Teoh – who founded TPG 30 years ago – with his wife Vicky took a basic idea and turned it into a $12 billion company.
In a statement to his shareholders, Mr Teoh said:
'Many of you have been with me on this journey for a very long time and I have been humbled by your support and belief in our vision for the company.'
‘There have been many challenges along the way, but I firmly believe that consumers in Australia have greatly benefited from TPG's competitive business approach, and that they will continue to do so.'
Mr Teoh described his replacement – Canning Fok – 'as one of the most capable business leaders in the world'.
TPG Telecom share price ↓
The TPG share price was down 54 cents or 7.86% to $6.33 per share by 11:30 AM as investors digested the news of Teoh’s departure.
The telco has seen its stock drift lower over the last year, falling over 28% in that period. At its 52-week high, TPG traded at $9.70 per share.
Telstra share price ↑
At the other end of Australia’s telecommunications market – Telstra saw its share price rally 2.55% to $3.42 per share by 11:34 AM.
The company has now seen its share price rise over 5% in the last 5 sessions. This comes as the company on Tuesday updated the market in regards to its bold restructuring plans. Under the restructure Telstra Group will be divided into: InfraCo Fixed, Infra Co Towers, and ServeCo.
YTD Telstra is up ~13%.
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