The Endeavour Group Ltd (ASX: EDV) share price is down 1.71%, in line with the fall in the broader market today, with the S&P/ASX 200 Index (ASX: XJO) also down 1.67%.
Endeavour shares are currently swapping hands for $5.18 amid news that the path for former Woolworths boss Bill Wavish to join the board has cleared a little further.
Endeavour issued a statement today saying Wavish had received one of the regulatory approvals he needed to meet the criteria for a board seat.
The company also confirmed it had satisfactorily investigated concerns around potential non-compliance with liquor and gaming laws should Wavish be voted in under the conditional arrangements in place.
Let's recap all this drama and get you up to speed.
Endeavour share price dips amid continuing controversy
Wavish and Endeavour's biggest shareholder, Bruce Mathieson Snr, have been highly critical of the board.
Previously, Wavish has commented that "it's a travesty to see the amount of money that's being lost". He also said he wanted to drive a "much-needed turnaround" as an independent board member.
Wavish nominated himself for a seat on the board in August. Initially, the board said it would not allow a shareholder vote on his nomination unless he had regulatory approvals in place first.
Mathieson Snr complained that that timeline was too strict, and it was well-known that such approvals could take months.
He also claimed the board had allowed votes on other directors prior to regulatory approvals, including for his son, Bruce Mathieson Jnr, a current board member who is also up for re-election.
Mathieson Snr threatened legal action if a vote did not proceed, saying the board's position "could only be a cynical attempt to further entrench the insider's club on the Endeavour board …".
The board reversed its decision but said if Wavish was voted in, it would be subject to him receiving those approvals.
The board also warned that the conditional nature of Wavish's candidacy could make the company non-compliant with liquor and gaming laws if he was voted in, so it would seek to minimise the risk.
Today's update from Endeavour addresses the outcome of that process.
According to the statement:
Following Endeavour's proactive and constructive engagement with the relevant regulatory authorities, Endeavour advises that it considers the risk of non-compliance with state gaming and liquor laws has been satisfactorily addressed if the proposed amended resolution for Mr Wavish's election is passed.
The required regulatory approval for Mr Wavish's appointment has been obtained from one relevant regulator and is expected to be determined by another relevant regulator prior to the AGM.
The remaining relevant regulators have confirmed that either they will take no enforcement action if the proposed amended resolution is approved, or that it would not otherwise result in a breach having regard to the circumstances.
The Board continues to recommend that shareholders vote against the election of Mr Wavish.
Why the board is against Wavish
In the notice of the AGM to shareholders, the board recommended that shareholders vote against Wavish.
Among the board's reasons was Wavish not having his regulatory approvals in place. It said it had also not had enough time to assess if Wavish was a suitable candidate.
Wavish was a senior executive at Woolworths between 1999 and 2004. He oversaw the expansion of Dan Murphy's from a small Victorian operation into a national chain. He helped create the BWS bottle-shop network and led the company's acquisition of Mathieson Snr's hotel business.
In his own statement, Wavish told shareholders that under his leadership, Woolworths became the market leader in liquor sales, and its network grew from 42 to 574 outlets in five years.
The board said it had also not yet concluded its process to confirm Wavish's independence under Endeavour's criteria for external board members.
It also pointed out that prior to Wavish's nomination, the board had begun working with an external search firm to identify candidates for two additional independent non-executive director seats.
The board said:
Members of Endeavour's Nominations Committee met with Mr Wavish to advance the assessment of his skills, experience and suitability to be a director of Endeavour, having recognised that aspects of Mr Wavish's prior skills and experience may align to Endeavour's future requirements.
Mr Wavish was invited to participate in the formal director search process underway and to be considered with other prospective candidates. At the time, he declined to participate in this process. The offer remains open to Mr Wavish to join the process.
Endeavour chair warns shareholders
Endeavour chair Peter Hearl has warned shareholders not to believe everything they hear from The Bruce Mathieson Group.
In a letter lodged with the ASX on 10 October, he said:
The Bruce Mathieson Group campaign has used selective and incomplete information which has the potential to confuse shareholders as to the Company's performance.
The letter outlines some of the Bruce Mathieson Group's claims and the board's response to each claim.
The company will hold its annual general meeting on 31 October.
Endeavour share price snapshot
Endeavour shares have fallen 23% over the past two years and are down 18% in the year to date.