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(Bloomberg) -- Singapore Post Ltd. shares slumped by the most in more than four years after the firm fired its chief executive officer and a number of other senior executives following allegations related to its international e-commerce logistics parcels business.
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The stock slid as much as 9.8% at Monday’s open, the most since March 2020 on an intraday basis.
The Temasek Holdings Pte-backed firm said Sunday it began investigations after receiving a whistleblowing report alleging several employees manually submitted information with the intent of avoiding contracted penalties with one of Singapore Post’s largest customers. The report was also sent to the government regulator, according to a company statement.
Three managers were dismissed for the violations, and a police report was filed against them. CEO Vincent Phang, Chief Financial Officer Vincent Yik and Li Yu, CEO of its international business unit, were also terminated after the company found they were “grossly negligent” in handling the matter and made “serious misrepresentations” to the audit committee over the allegations.
With the changes in management, Singapore Post’s board will “double down on its initiatives to dispose of non-core assets and return value to shareholders at a faster pace,” Maybank Securities Pte analyst Jarick Seet wrote in a note to clients on Sunday.
“We expect a negative knee-jerk share price reaction on Monday opening but price should recover there after as time passes,” he added.
New CEO
Singapore Post plans to announce a new CEO in due course and will appoint Isaac Mah, currently CFO of its Australian business, to replace Yik. Chairman Simon Israel will oversee the senior management of the company in the interim.
The company said it will pay a settlement to the unidentified customer. The settlement won’t have a material impact on the company’s net tangible assets for earnings per share or the current financial year.
Phang and Yik said the termination is “without merits, and was also procedurally unfair,” in a separate statement. Both have rejected any suggestion that they were grossly negligent and will “vigorously contest the termination of our employment, both on merits and on the grounds of procedural unfairness.”
--With assistance from Jackie Cai.