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Brambles weaker after CEO goes
SYDNEY, Australia (CNN) -- Shares in Anglo-Australian logistics group Brambles were down 1.5 percent in Friday trade following the surprise resignation of chief executive C.K. Chow on Thursday night. Chow will leave on October 20 to become chief executive of Hong Kong subway company MTR Corp. Chow took over from John Fletcher -- now CEO of retailer of Coles Myer -- following the merger of Brambles with UK group GKN in April 2001. The merger and dual listing of Brambles-GKN has not been the success the two companies envisaged. Market capitalization has fallen from almost Aust. $20 billion ($13 billion) two and a half years ago to just A$4.5 billion now. Brambles has seen its share price fall more than 65 percent since touching A$13.19 in May 2001, soon after the merger was announced. The decline is tied largely to problems with its European CHEP pallet business. Brambles shares are trading at A$4.71 near midday Friday. They hit a record low of A$3.77 in February this year. Earlier this month Brambles reported a 39 percent profit fall to A$330 million. That came after a profit downgrade in November and a A$104 million charge to restructure the European pallet operations. Chow's replacement as CEO is chief financial officer David Turner. Chow in turn replaces Jack So at MTR. So left MTR to join Richard Li's Pacific Century group in Hong Kong. There has been speculation this month that Brambles is a takeover target, with GE mentioned as a possible bidder. Last Friday Brambles released a statement to the Australian Stock Exchange in which it said it had not been approached by, nor was it in discussion with any party, over a possible offer for the company.
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