GEON sweats as Gordon throws in the towel

High-profile CEO, Gordon Towell, quits after 18 months at the helm of the giant, private equity backed, sheetfed printer. Graham Morgan, COO steps into the breech.

The US sub-prime induced credit crunch has derailed the Gresham PE strategy of launching the consolidated print group on the stock market in the near future. Gresham’s original 18-month to three-year timetable has been abandoned as global terms of credit tighten and investor caution continues to rise. The current financial environment is not susceptible to speculative floats.

The PE equity backers now have no option but to knuckle down to the hard management yards of getting the diverse locations of GEON to operate as a single profitable printing company. It will not be an easy task.

Citing the delay in moving to an IPO as one of the factors behind his decision to quit, Towell also identified exhaustion from constant travelling between the company’s 16 sites on both sides of the Tasman. In the past year he has spent upwards of $40 million in plant and equipment as well as continuing to gobble up independent printers – the latest being Advance Press in Western Australia – as part of the rapid growth strategy of the region’s largest specialised sheetfed printing company. (See the full interview with Gordon Towell in this month’s issue of Print 21 magazine.)

“It was not any one thing that led to the decision, more a combination of the wrong balance of life, too much travelling around and, of course, the decision not to list. There has been a profound change in the market over the past few months. With the delay I was looking at being locked in for five to six years after listing,” he said.

Towell will remain with the company for up to six months focusing on bringing to fruition its IT transformation, creating online ordering portals and standardised MIS. His commitment is less binding now that internal candidate, Graham Morgan, formerly GEON’s chief operating officer and one of Towell’s earliest recruits, has taken over the top job.

In an internal memo to staff Sandy Maier group chairman confirmed Towell’s continuing engagement with GEON. [He] has agreed to assume the role of special advisor to the Board to lead a further series of initiatives focussed around growth, especially within the “large corporate” sector.