Potholes Ahead At Bluefreeway.
Posted on January 8th, 2008 by Simon Chen
Something’s up at the digital congolmerate that’s been spreading like the ebola virus. Or more to the point, buying up companies globally like Imelda Marcos at a shoe sale.
Today, the ASX was advised that one of their Director’s was resigning. That’s no big deal. The deck chairs are always being moved around at public companies. Except this change could signal the start of something.
You see, the Director in question who threw in the towel was David Smithers, an ex partner and previous Chairman of PriceWaterhouseCoopers, a not too shabby accounting and professional services firm. He also used to be the President of the Australian Institute of Accountants. Oh, and also on the board of Rabobank.
Now I know that there are always 2 sides to the story, but I’d love to hear Mr. Smithers side first. Someone with his experience, wisdom and threshold for corporate pain doesn’t just call it quits after 90 days.
Something stinks.
The stock price for the once revered digital darling is now below the initial offer price - and is sitting at 0.95 cents. At it’s high last year, Bluefreeway peaked at just over $2.40.
I’m sure there’s been some interesting dinner conversation tonite between a lot of people, whose companies were acquired by Bluefreeway recently, with many deals done via equity in the new venture and on the basis of a ever promising stock price.
Emotion always trumps over the facts and reality.
This is one story that’s going to be watched by many. Personally, and it is only my humble opinion (and predicition for 2008) - that Bluefreeway will not be alive by the end of the year.
Hopefully, I’m wrong.
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on Tuesday, January 8th, 2008 at 10:56 pm and is filed under Predictions..., Web 2.0.
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January 9th, 2008 at 1:53 pm
Glad I got in early and scored an invite to the launch party in Sydney. And a very Sydney bash it was too. Couldn’t hear yourself speak but lots of beautiful people, business cards flashing promiscuously, endless supply of yummy food and an open bar. I’m reminded by your observations that someone suggested to me at that time that it was really a stock market play rather than primarily the manifestation of someone’s dream of a super multimedia/whatever conglomerate to solve all of industry’s online challenges with a one-stop shop.
January 9th, 2008 at 2:56 pm
[...] Bluefreeway, David Smithers, eight black, PriceWaterhouseCoopers, Simon Chen Simon Chen over at Eight Black has some interesting news regarding Australian digital media conglomerate [...]
January 10th, 2008 at 10:26 am
Knowing how the CEO, Rick Webb, operates I’d suggest that Mr Smithers wasn’t prepared to put up with the bullying the board would have been receiving from him. The observation that this was a ‘play’ is probably sound. My speculation is that at some point, Mr Webb and Mr McDonnell would have taken the company back private and re-listed on the Nasdaq, thanks to funding from US equity. The squeeze in the US will have made that next to impossible, and hurt their expansion plans.
Word from inside is that it’s an extremely political, aggressive place to be.
(disclosure: I am actually a shareholder so personally I’d love the price back up around $2.40!)
January 10th, 2008 at 4:49 pm
Blue, thanks for the comment. As at close of market today, BLU was trading at 0.86 cents. How long are you prepared to hang on…?