The Paino family, owners of prominent South Fremantle business Sealanes, provides a telling case study of a management succession that has not run according to plan.
The Paino family, owners of prominent South Fremantle business Sealanes, provides a telling case study of a management succession that has not run according to plan.
A combination of ownership changes and ill health among key managers led to an exodus of commercial experience over the past eight months, putting 29-year-old chief executive Leeanda Paino in a challenging position.
Ms Paino, who became chief executive late last year after her father Sam Paino moved to sole ownership, insists that all is well.
“We are a very successful, mature business and we are in a very strong financial position,” she told WA Business News.
The company was founded* by Salvatore Paino in the 1920s and his sons, Sam and Vic, took over in the 1960s.
Together they built a large and diversified business in food services, ship supplies and fish retailing, with employment rising to 210 people and turnover rising to nearly $100 million.
Third generation family members, including Mark and Paul Paino, entered the business and took senior roles.
The company also started to put in place governance and management structures akin to a listed public company.
Brian Pozzi was appointed chief executive and an advisory board was established, with Q Legal partner Kevin Dundo (formerly of Clayton Utz) and corporate adviser Alex Bajada.
Despite this, Sam and Vic retained their positions as joint managing directors and kept ultimate control of the business.
The family considered a number of strategic options over recent years, including trade sales and a share market float.
Those plans came to naught and instead last October Sam bought out his brother and moved to sole ownership.
As a result, Vic left the business, as did his sons Mark and Paul.
One month after taking sole ownership, Sam suffered a stroke and has been unwell ever since, and Brian Pozzi departed soon after due to ill health. In addition, the advisory board has been disbanded.
These changes have put the spotlight on Leeanda Paino, who worked at Clayton Utz before joining Sealanes as legal counsel in mid 2003.
She believes a lifetime of exposure to the family business, mentoring by her father and several months of preparation for the changeover has prepared her well for the chief executive role.
Ms Paino said she consults regularly with her father, who has limited vocal capacity as a result of the stroke.
She said Sealanes also had experienced and loyal managers, who were able to run the business while she focused on growth opportunities.
Ms Paino said the advisory board was disbanded because its main role was to look at succession issues for the two arms of the family.
“Succession isn’t an issue now because the business is owned by one family,” she said.
*Sealanes could be considered a fourth generation business as it can date its roots back to 1895 as a small grocery shop, The Roma Fruit Palace in Market Street, Fremantle selling grocery items and importing Italian goods for the local migrant population. In 1928 the range of goods expanded into selling fresh seafood to local customers and supplying cafes and restaurants. The move to purchase the shop next door resulted in converting the Roma Fruit Palace into a retail fish shop and re-naming it Fremantle Fish Supply.
SEALANES
- Founded* in the 1920s by Salvatore Paino. Sons Vic and Sam took over in the 1960s.
- Turnover rose to $100m, 210 staff.
- October 2004, Sam bought out Vic’s share. Vic and his two sons left the business.
- Sam suffered a stroke one month after taking sole ownership. Leeanda Paino, 29, in role of chief executive since late 2004.
