Gate Gourmet chief falls on sword over fraud case

Gate Gourmet chief falls on sword over fraud case

Guy Dubois, chief executive of gategroup, has informed the board he takes responsibility for the recent fraud case involving a former employee and consequently has resigned effective immediately.

While the investigation has concluded he had no knowledge of or involvement in the fraud, his family’s association with that of the employee charged in the case has created the appearance of a conflict that would affect his authority to lead the Group.

“We have been misled by the employee charged in this case and the fraud happened under my watch. For this I take responsibility and step down,” said Dubois.

Dubois will resign as a member of the board of gategroup Holding, and the executive management board with immediate effect.

He will continue to support the Company during a transition period.

gategroup confirmed it had been a victim of fraud in February this year.

External forensic accounting experts have since carried out investigations finding that the fraud occurred at the “subsidiary level” and that the total amount over the period in question amounted to CHF22 million.

The majority of the fraud occurred prior to 2010.

The estimated cash shortfall at the end of 2010 was in the region of CHF10 million, before recovery.

Group cash balances at the end of 2010 were CHF 459 million.

The board of directors accepted his decision and expressed its appreciation for his many successful years at the company, and wished him success in the future.

Chairman Andreas Schmid stated gategroup will continue to pursue its successful strategy and direction, which was demonstrated in the group’s recently announced financial results.

Andrew Gibson, group senior vice president, has been appointed as interim chief executive by the Board of Directors effective immediately.

“I am extremely pleased to entrust the leadership of the group to Andrew, a seasoned executive and a key leader of the Group over the last six years,” added Schmid.

“Andrew led the design and execution of the Group’s European and American operational turn-around, each of which were followed by impressive margin growth.

“He also has been very involved in the development of the gategroup global strategy and in the execution of merger and acquisition activities, most recently with the Cara acquisition in Canada,” Schmid said.

Portugal

At the same time, Gate Gourmet, a member of gategroup, has sold its interests in Portugal to Newrest effective immediately.

Details of the agreement remain confidential.

Gate Gourmet operated a wholly owned facility at the Lisbon airport and was in a 50/50 partnership at Funchal Airport in Madeira, the Portuguese resort island in the Atlantic Ocean.

Under the agreement, Gate Gourmet’s ownership interests in both operations have fully transferred to Newrest.

The transaction is not subject to any further regulatory or shareholder approvals.