The share price of automotive retail group Bapcor the company that runs the Autobarn and Autopro retail groups plunged and slightly recovered to $4.56 after the market digested the news that Paul Dumbrell would not take up the CEO role, he was due to start in 2 days.

At $4.56 this is half the value of the business only 3 years ago when it traded at close to $8.50. This must surely put Bapcor in danger of takeover by private equity.

Paul Dumbrell was not just any CEO candidate; he had close ties with Bapcor and when it was Burson Automotive. He is as close to an insider as you can get.
So, what has he seen to turn tail at short notice?
I am sure it’s not good for Bapcor, but time will tell an interesting story.

In the 1980’s I was working in McEwans who at the time were part of the Repco Group. I had gained a reputation within the company as a “corporate fixer/cleaner” having been part of the team that was deployed to get the McEwans Queensland’s operations “fit for sale” . The team consisted of Ed O’Leary, Collin Williams, Shane Dutton and me.

Over the span of 12 months, we tidied the business up to the extent that Lloyds a South Australian hardware institution bought our Queensland operation. Job done; the team moved back to Melbourne where the focus was squarely on the Victorian business.

Repco had this small speed shop retail chain called “Dynamic Auto” and in what can only be described as a “hospital pass” moved Dynamic Auto into the McEwans division.

Dynamic Auto had stores in all the eastern states, a head office in Burwood New South Wales, and were largely on short term leases of small footprint stores in B and C grade shopping centres.
Nothing like a hardware business. And they were haemorrhaging money.

Brian Ellis the MD of McEwans called and said “we need you to do the clean up” of Dynamic Auto so we can sell the business. But this time it’s just you, you need to use the team at Burwood.

So, I was on a plane within a few days having been appointed as the “General Manager” of Dynamic Auto. I enlisted the help of three “trusted” members of the Burwood team, Dean, Warwick and Alan and we commenced the clean. It took 12 months to get the division “polished up” for sale.

So, what has this got to do with Bapcor and Paul Dumbrell you might ask?

Once the division was fit for sale Garry Dumbrell, Paul Dumbrells father, and George Kallinikos acquired the Dynamic Auto Accessory Group from McEwans and folded it into the Autobarn group of stores they were building. This swelled store numbers significantly. My job was done.

Putting my “cleaner hat back on” I had a look at the last Bapcor half year report.
With retail “it’s in the numbers” its “always in the numbers”, margin, inventory, provision for markdown and the value of intangible assets, all just like a microfibre cloth, good for polishing.

Watch this space I am sure we are all going to learn something.