Sky TV boss resigns a week after deciding to return to Europe

Tuesday, 1 December 2020

Sky Television chief executive Martin Stewart had been in the job for just 21 months.

Former Sky Television chief executive Martin Stewart says he decided to resign only last week and hasn’t yet thought about what he plans to do on his return to Europe.

The pay-television firm announced Stewart’s resignation after just 21 months in the job to the New Zealand stock exchange on Tuesday morning.

Sky’s chief commercial officer, Sophie Moloney, was appointed chief executive “effective immediately”.

British-born Stewart said the likelihood of continued Covid border restrictions had contributed to his decision to return to Europe.

Sophie Moloney has been appointed chief executive with “immediate effect”.

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Talking to Stuff about his departure, Stewart said New Zealand was a wonderful place to live.

“But at the end of the day it is a long way from pretty much everywhere and those sorts of things do play on your mind and that is really all that there is to it.”

He hadn’t given “a moment’s thought” to whether he would stay in the pay-television business back in Europe, he said.

“The way I operate is I give 110 per cent to whatever I’m doing. And when I think that’s the point [at which] I’m done with that, then I start thinking about what next.”

It is uncommon for listed companies such as Sky to appoint a permanent chief executive without some form of executive search.

Sky Television’s legal team is confident it can still get the sale and outsourcing of its outside broadcasting business across the line, despite the Commerce Commission’s competition concerns.

But Stewart said in this case there was no point.

His long-term hope had always been that Moloney would take over as chief executive, he said.

“You can go and search for anybody that you want – you are going to come back to the same answer.”

On Tuesday, Sky’s shares fell 5 per cent to 16 cents each during lunchtime trading on the NZX, in the wake of the announcement.

Stewart bought more shares on-market last month. “I may keep buying shares because I think the company is grossly undervalued,” he said.

“Don’t expect to see me suddenly selling all my shares, I think, because that is not going to happen.”

Sky chairman Philip Bowman said the board respected Stewart’s decision to leave and was “pleased we have been able to reach a mutual agreement for him to do so”.

“Since joining Sky in February 2019, Martin has led a successful turnaround and the board acknowledges his significant contribution,” he said.

Strategy continues

Forsyth Barr analyst Matt Henry said the announcement came as a surprise but he didn’t expect to see a huge shift in Sky’s strategy under Moloney.

“She was brought in by Martin and has been a key person in his team. It is as smooth a transition as you could get.”

Stewart took over from Sky’s long-standing chief executive John Fellet at a time when Sky was still reeling from the Commerce Commission’s refusal to clear its proposed takeover by Britain’s Vodafone.

The company’s share price continued to slide following his appointment, but he has taken several steps to chart a different course for the company.

These include announcing a move by Sky into the broadband market while at the same time forging a nascent partnership with streaming sports rival Spark, and considering giving Sky satellite customers more flexibility in their channel options.

His commercial achievements included overseeing a crucial $157 million capital raising in May.

Sky delivered some good news to its beleaguered shareholders last month, increasing its profit and revenue guidance for the year to June after a “positive start” to its new financial year.

But it suffered a setback on Monday when the Commerce Commission signalled significant competition concerns with a plan by Sky to sell and outsource its outside broadcasting business, OSB, to a United States-owned company, NEP New Zealand.

‘Media in my blood’

Moloney is Sky’s first female chief executive.

The nature of continuous disclosure obligations on listed companies made decisions such as Sky’s chief executive transition seem more abrupt than they were, she said.

“I have worked for companies called Sky for most of my working career. I have got pay TV and media in my blood.

“I have been working very closely with the board alongside Martin, in effect as his ‘2IC’, for a decent amount of time, which I appreciate the outside world doesn’t necessarily see.”

Moloney said she had a real desire to see Sky recognised as a “New Zealand company”.

“I think there is a huge amount more we could be doing with all of our partners in terms of the broader Sky community throughout Aotearoa.”

She remained hopeful Sky would be able to get the sale of OSB across the line and said Sky’s legal team did not see a “statement of issues” released by the Commerce Commission as a rejection.

“We remain confident that we are going to get to the right place,” Moloney said.

“It is a hugely important deal for us in terms of looking after our people, and working closely with NEP is definitely the right path for us.”

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