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Fairfax Media spinoff Domain says CEO will resign just two months after listing
[SYDNEY] Australian property website Domain Holdings Australia Ltd said its chief executive quit two months after listing to spend more time with his family, a move analysts called a "big surprise" as its shares tumbled to a record low.
The resignation is a setback for a company trying to convince investors it can grow in a cooling residential real estate market. Australia's once-booming home prices began to stall late last year after years of double-digit increases, just as Domain listed.
It also puts pressure on Domain's former owner Fairfax Media Ltd, publisher of The Sydney Morning Herald, The Australian Financial Review and other major newspapers, which hoped to weather an industry-wide decline in advertising revenue by keeping a 60 percent stake in Domain.
Domain said in a statement that Antony Catalano, CEO since 2013 and widely credited with expanding the firm's nationwide reach, quit after deciding over the summer holiday "the demands of his role and his absence from the lives of his family were proving more challenging than he had expected".
Mr Catalano, who has eight children, said in the statement that "I understand and regret that the timing of this decision is unusually short from Domain's listing".
Domain shares were down 11 per cent at A$2.96 (S$3.13) in midafternoon trading, their lowest level since Fairfax spun off the company as a separate listed entity in November. The decline reduced Domain's market capitalisation to A$1.7 billion ).
Fairfax shares were down 6.3 per cent at 67.5 cents, their lowest since the Domain listing.
Citi described the news as "a big surprise" in a client report, adding that "Mr Catalano was a key factor in the success of the separation of Domain ... with the next level of management not nearly as well known to investors." The Domain statement said the company's chairman would lead the company while it embarked on a global search for a new CEO.
In November, Fairfax asked shareholders to vote to let the Domain board have discretion to choose any bonuses Mr Catalano would receive upon leaving the company. On Monday, a Domain spokeswoman said Mr Catalano would not receive a departing bonus.
Fairfax declined to comment.
Domain, which reports first-half results in February, said it expects revenue growth of 13 per cent in 2018, unchanged from previous guidance.