SINGAPORE - Singapore Post chairman Simon Israel said the postal and e-commerce service provider is taking steps to rehabilitate a loss-making acquisition that is at the centre of an internal probe.
In a speech to SingPost shareholders at the company's annual general meeting (AGM) on July 20 which was read in his absence on his behalf by non-executive lead independent director Fang Ai Lian as he had been taken ill and admitted to a hospital, he acknowledged that "shareholders may have many questions in relation to the summary report".
Mr Israel, who is also chairman of Singtel, was referring to the findings of an independent review which said the former directors of SingPost did not fully consider certain key risks before signing off on the postal service provider's largest acquisition - TradeGlobal, the loss-making United States e-commerce business that SingPost acquired for US$168.5 million (S$230 million) in October 2015.
"As we have stated, we will be handing the full report to the regulators for their review. They are the best people to follow through with it," he said.
SingPost group chief executive Paul Coutts, who was also at the meeting, said he recently had talks with Mr Paul Demirdjian, chief executive of Jagged Peak, which is implementing the turnaround plan for TradeGlobal with the management team.
"Jagged Peak is doing well in terms of revenue and profitability and has some very exciting leading-edge technology which we can transfer to other parts of our business. For TradeGlobal, there is work to be done," he said.
Mr Coutts said SingPost is implementing a turnaround plan for TradeGlobal, which involves using warehouse automation to address labour issues in the Cincinnati area, tackling broader structural issues facing the business and adopting best practices from Jagged Peak's asset-light and technology-driven business model.
"There is a lot to be done and I am under no illusion that it will take time to turn things around at TradeGlobal," he noted.
"On the other hand it is also important to remember that e-commerce logistics is borderless and global in nature. It cannot be overemphasised that the US is an important market. Both TradeGlobal and Jagged Peak have a solid portfolio of both US and global customers and brands which brings with it opportunities for synergy benefit and growth."
He assured shareholders that management is "committed and focused on the turnaround plan and recovering as much value for shareholders as we possibly can".
A piece of good news for shareholders came after the AGM had ended.
According to a Singtel spokesman, Mr Israel is "expected to be discharged tomorrow after undergoing some tests and observation".