SLAVEN GOES, JAMES HANNAN NEW OVATO CEO, DIVISIONS SOLD
James Hannan is the new CEO and managing director of print giant Ovato, succeeding Kevin Slaven, as the company sells its retail distribution business to Are Media, to enable it to focus on printing.
Hannan – Ovato's chief operating officer, and a member of the Hannan family, which is the largest shareholder in the business – has already taken on the CEO mantle. Slaven will remain with the company until the end of this month.
Slaven's contract had been due to expire in September. He has been CEO since December 2017, taking over when former incumbent Peter George stepped back suddenly due to family reasons. He has been CEO during a period marked by severe turbulence, and which has seen the company become half the size it was.
James Hannan has been in print for 18 years, and since 2014 in senior roles, within first IPMG, then PMP / Ovato. He played a key role in the recent restructure, which saw suppliers take a 50 per cent haircut on invoices, and saw Melbourne close down. He is also leading the drive to divest non-core assets.
The distribution business, now known as Retail Distribution Australia & New Zealand, has been bought by Ovato shareholder Are Media for $15m, with Are also taking on the $27m negative working capital. Ovato is also selling its marketing services business, to Hannan-owned entity Ballygriffin, for $9m.
Michael Hannan, Ovato chairman, said, “The challenges of the industry over the last decade were further exacerbated by Covid-19. In response, the business will bring its focus back on print, the core of its operations. It will allow focus to be placed on a strong, viable and profitable printing business in Australia, and the ability to invest in new technologies to support print.
“The sale of the Retail Distribution and Marketing Services businesses will greatly assist in providing Ovato with cash reserves for ongoing transformation, and will be the catalyst for a significant flattening of the corporate costs starting from the top with immediate savings being realised by not replacing any departing member of the leadership team.”
Are Media is the biggest publisher in Australia and in New Zealand, with 55 per cent of the magazine market. It owns 16 per cent of Ovato thanks to its $10m cash injection in December. It was formerly Bauer Media, until it was bought by the same private equity fund that owns Ovato’s main New Zealand rival Webstar. German-owned Bauer lost $500m on buying what was Kerry Packer's old ACP empire in 2012 and selling it eight years later.