Domenic Carosa dumped from Destra
Tuesday, April 22, 2008/
Domenic Carosa has been dumped as chief executive of digital marketing company Destra by the company’s new major shareholder.
Television and media group Prime Media, which increased its stake in Destra last week from 19.6% to 44%, has also announced sweeping changes to the company’s management structure, removing the company’s entire board with the exception of Prime chief executive Warwick Syphers.
But Opes Prime victim Carosa, who founded and has been Destra’s very public face for 14 years, is remarkably upbeat about losing his job. He will continue to provide his services as a consultant to the board and remains committed to the company as a shareholder. “This is a good move for Destra and this is a good move for me personally,” Carosa says. “I’m fully supportive of these moves.”
Carosa says he is very proud of his achievements at Destra, which include shepherding the company through the dot-com crash and restructuring its operations on a number of occasions as the online and digital media markets evolved. “I feel like a father when his son or daughter is leaving home for the first time.”
When asked whether he might now have time to start another business, Carosa said his immediate priorities were a short holiday and assisting the new Prime board with its strategic review of Destra.
Prime Media, which is controlled by billionaire Paul Ramsay, took a stranglehold on Destra after acting as underwriter on Destra’s five-for-11 rights issue, which raised $15 million to allow the company to pay debt and increase working capital. Prime acquired most of the new shares issued, taking its stake from 19.6% to 43.6%. Prime also has paid Destra $3.5 million for a convertible bond that, if converted, would further increase its stake to 48%.
Prime’s interim board will be led by David Gordon as executive chairman. Gordon is principal of Lexicon Partners, a Sydney-based advisory and investment firm. Lexicon will lead a complete strategic review of Destra’s business, including looking at the integration and consolidation of some of Destra’s recent acquisitions and the company’s capital requirements going forward.
Syphers and Peter Evans, who is also a non-executive director of Prime Group, will also sit on the board. “The successful completion of Destra’s rights issue enables the company to reassess and review its operational and strategic options. The review will also focus on emerging opportunities in the digital media space, appropriate resourcing and positioning Destra for future growth,” Syphers said in a statement to the ASX.
Destra has been rocked in recent weeks by the collapse of stock broker Opes Prime. Carosa and major shareholder Paul Choiselat had used the broker to finance parcels of 10.6 million and 10.96 million shares in the media minnow. Those shares are now in the hands of Opes Prime’s secured creditor, ANZ, although Choiselat has challenged the bank’s right to take the shares.
On top of this, Destra also used Opes Prime to finance the purchase of a 10% stake in television production company Beyond International. Destra has lost those shares too, and been forced to take a $900,000 loss on the holding.
Destra’s shares rose 2% this morning to 9.7 cents.