Andrew Price makes his move on PaperlinX

Former print management supremo of Stream Solutions, drives for a seat on the board of the ailing paper merchant in a move that likely heralds a major corporate makeover.

Price wants to sack the Chairman of the board of directors, Harry Boon, and assume his seat, if not his position. He leads a group of shareholders representing 5.07% of the company. The group lodged a request for a general meeting to get Price onto the board.

In a statement issued on Friday he confirmed that the recently appointed Harry Boon declined to go quietly and expressed disappointment that an AGM was required.  "Mr Boon declined our invitation so we must now go through the process of requisitioning the company to call an Extraordinary General Meeting so that all shareholders can have their say", said Price. "It is disappointing that the business has to incur these additional costs".

If successful  - and given Andrew Price it is likely to be – the move almost certainly signals the eventual break up of the once dominant paper company. In recent weeks US-based hedge fund, Platinumn Equities, has been in takeover negotiations. Analysts suggest the now European-centred company is ripe to be dismembered as its share price and prospects show little sign of improvement under the current regime. PaperlinX is expecting a loss of $26 million for the first half of this year.

"It is quite rare in Australia to have an EGM called under these circumstances although given the dismal performance of PaperlinX in recent years, it's not unexpected," said Price. ""I see enormous opportunities for the PaperlinX business, if managed correctly, and I am prepared to take an active role in returning the company to profitability."

Any move to realise the value of the company other than by trading out of difficulties or seeking administration is likely to be vigorously opposed by a group of hybrid investors, who have been kicking up a row in recent weeks. The current bid from the PE group slashes the value of their investments.

The PaperlinX share price has continuously fallen from a high of $5.37 in 2003 to its current trading levels, just below 7c, making it one of the worst performing stocks on the ASX in recent times.

Price has a track record in the paper industry having worked for Spicers before starting up the industry changing, Stream Solutions in the 1990s, a company that brought print management to a new level. It was eventually sold to Toll Holdings, with Price taking his payout and spending much of the past year travelling in Europe. He has obviously not been idle. In recent weeks he denied buying shares in PaperlinX

A break up of PaperlinX is likely to see the Australasian operations and perhaps the USA-based Spicers Paper Inc business hived off. PaperlinX has recently retired the Daltons brand, retaining only the Spicers Paper for all its printing papers.

The move has been on the cards ever since the effective control of the Melbourne-based company moved to the UK, with Toby Merchant, managing director. Most of the business is now European with no synergies to the local operation.