Firm loses ?1,690cr in value as boss fired over 'misconduct'
UK roadside repair firm AA on Tuesday lost over £200 million (nearly ?1,690 crore) or nearly a fifth of its value. This came after shares fell as much as 18% during the day after it fired its Executive Chairman Bob Mackenzie with immediate effect for 'gross misconduct'. However, his son said he resigned over an 'extremely distressing mental health issue'. 
The AA has fired its boss, Bob Mackenzie, for ?gross misconduct?, with immediate effect, wiping nearly a fifth off the value of the company and making it the biggest faller in the FTSE 250.?Bob Mackenzie has been removed by the board from his role as executive chairman, from his other roles and as a director and as an employee of the company, for gross misconduct,? the AA said.A spokesperson for the roadside repair company said the sacking was a ?personal conduct related matter?, but gave no further details. It is not believed to involve fraud.However, a statement attributed by the Times to Mackenzie?s son, Peter Mackenzie, said his father had a serious health issue and had resigned. The statement said his father had tendered his resignation and resigned his directorships due to acute ill health. ?He is very unwell and has been admitted to hospital,? it said. ?The family trusts that all parties will act responsibly towards a loyal servant of the company in a manner which reflects the stress he has been suffering.?The company declined to comment beyond its initial statement.The shock announcement sent shares down as much as 18% at one point. The shares closed down 14%, wiping about £200m off the value of the company.Mackenzie, 65, has been executive chairman of the AA since 2014, when he was instrumental in a stock market flotation of the company. His previous roles include chairman and chief executive of National Car Parks and its subsidiary Green Flag, a rival car breakdown business.The AA said Mackenzie?s responsibilities would be split, with Simon Breakwell, a non-executive director since 2014 and a founder of the travel company Expedia, appointed as acting chief executive. John Leach, who was senior independent director, has been appointed as chairman.The company had already announced plans to split the combined roles of executive chairman, with the aim of appointing a chief executive.In a trading update published alongside the announcement of Mackenzie?s departure, the AA said it was confident about the company?s long-term prospects but its financial performance in the first half of 2017 had been hit by a number of factors.?The financial performance in the first six months has been negatively impacted by the effect of erratic work load patterns on an inherently fixed cost base. This was especially true in June and July which saw significant spikes in demand.?We now expect the full-year performance to be broadly in line with that of the last financial year.?The AA said paid members totalled 3.33 million in the first six months of the year, an increase of 6,000 compared with the same period a year earlier. The company would publish first-half results on 26 September. ?At that stage, Simon Breakwell will be in a position to provide an update on our plans,? the company said.Analysts at Liberum noted their surprise at Mackenzie?s departure, adding that they ?do not believe that it is fraud-related?.They revised down their expectations for full-year earnings before interest, tax, depreciation and amortisation by 3% to £403m, but said the company had made progress in some areas. ?After the accelerated [stock market listing] in July 2014, management had acquired a strategic asset akin to a desirable residence in Mayfair, where the plumbing and electrics were in need of investment,? the Liberum analysts said. ?We now believe that the face-lift is largely complete.?Some of the key metrics are generally encouraging, although that may be lost today. The transformation may have taken longer but there is tangible evidence of improvement.?The AA said that existing board member Andrew Blowers would replace John Leach as senior independent director, while Martin Clarke continues as finance director.