WiseTech CEO settles bankruptcy case with former lover as scandal wipes billions from company
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Australian billionaire Richard White is battling allegations of inappropriate behaviour with women.
PHOTO: BLOOMBERG
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SYDNEY - Mr Richard White, the Australian billionaire battling allegations of inappropriate behaviour with women, has reached a legal settlement with an alleged former lover who he was pursuing for bankruptcy.
The case was settled on Oct 18 and a notice of discontinuance was filed with the Federal Court of Australia late on Oct 21, the court’s website shows.
Mr White, the chief executive of WiseTech Global, had been attempting to push wellness entrepreneur Linda Rogan, with whom he is alleged to have had a sexual relationship, into bankruptcy, according to the Australian Financial Review.
Earlier in October, she applied to have the bankruptcy notice set aside. In an affidavit, she alleged Mr White expected her to have sex with him in exchange for an investment in her business.
Over the last three weeks, the drip of revelations from the court battle has gripped Sydney’s business elite. The case was also left largely uncommented on – in public – by WiseTech’s board of directors.
That changed on Oct 21 when WiseTech’s board said it is reviewing “the full range of matters”
Mr White, 70, who had amassed a personal fortune of US$11.1 billion thanks to WiseTech’s growth, lost US$2.9 billion of his wealth, according to the Bloomberg Billionaires Index.
Wisetech shares fell a further 3.2 per cent early on Oct 22, before erasing the loss after news of the settlement broke, to be trading up 1.6 per cent at 1.20pm in Sydney.
“A founder CEO of a major Australian company is a public figure, front and central to the name, brand and success of the company,” said Ms Helen Bird, senior lecturer at Swinburne Law School in Melbourne. “When the price of the stock drops in consequence of one of these type of news stories, it suggests that the reputation of the company has been affected.”
The Australian Council of Superannuation Investors, which represents some of the country’s largest pension funds, said the matter was a “major concern” for investors and called for the WiseTech board to investigate and respond appropriately.
AC/DC
Mr White grew up in the middle class Sydney suburb of Bexley dreaming of being a rock star, eventually leaving school to pursue the ambition. It soon soured.
“I played in a band for a number of years, but I realised it was a very tough industry to work in,” he told the Australian Investors Podcast. “You got a lot of fame and attention, but you got no money.”
He then began fixing guitars, and became so proficient that he even repaired the guitars of AC/DC’s Angus Young.
“It was very profitable,” he said on the podcast. “But I realised it was a service business that I couldn’t scale.”
In 1994, he and Ms Maree Isaacs founded WiseTech, which is a key provider of the software that coordinates logistics and shipping across the world. Twenty-two years later, the company was valued at A$1 billion (S$876,000) when it listed on the Australian Securities Exchange.
The following year it entered the S&P/ASX 200 and today it employs 3,300 people across 37 countries. It claims the majority of the world’s biggest global logistics providers and freight forwarders among its clients, including DHL, China’s Sinotrans, Japan’s Nippon Express and APL Logistics.
Mr White is WiseTech’s largest shareholder, making the current situation the board faces particularly challenging.
“The recent reports have undoubtedly cast a shadow over the company’s reputation,” said Ms Megan Motto, the CEO of the Governance Institute of Australia. “Markets are highly sensitive to such news, especially when it involves the personal conduct of a high-profile founder.” BLOOMBERG
