Lark (ASX:LRK) share price rebounds 7% following sell-off

The whisky distiller's share price is recovering from yesterday's shock announcement.

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Three gentleman in suits clink their glasses of whiskey together in celebration of the rebounding Lark share price today

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Key points

  • The Lark share price has jumped back 6% today 
  • The distillery's CEO resigned yesterday amid a case of extortion 
  • Lark is doubling down on its hunt for new leadership 

The Lark Distilling Co Ltd (ASX: LRK) share price is climbing back from a 21% nosedive yesterday after the company announced the shock departure of its CEO.

At the time of writing, the Lark share price has rebounded 6.94% to $3.85.

Need to be brought up to speed? Here's what is happening…

Why has the Lark CEO quit?

In a rather sudden announcement, Lark CEO Geoff Bainbridge has handed in his resignation in order to attend to a "personal matter" made known to the Board the day before.

It turns out that the personal matter involves a case of extortion. The Australian newspaper reported yesterday that it had obtained a video in which Bainbridge appears to be engaging in drug use.

Lawyers representing Bainbridge were quoted by the paper saying he is "the subject of a continuing, sophisticated and recently intensified extortion attempt by persons overseas using manipulated unverified images". 

Further, the lawyers said: "The attempted extortion of Mr Banbridge commenced years before he had any involvement in Lark Distillery…"

In the meantime, non-executive director Laura McBain has taken the reins as interim managing director.

And seeing as Lark had been hunting for a CEO successor since December as part of its long term planning, the process has been kicked into overdrive.

Lark share price snapshot

The Lark share price opened yesterday at $4.10 and dropped as low as $3.48 throughout the day. By market close, Lark shares were sitting at $3.60 each — a decrease of just under 21%.

Today, Lark began trading at $3.99 but dropped back to $3.84 around lunchtime trade.

Over the last 12 months, the Lark share price has increased by 127%. In March last year, the shares were trading at a 52-week low of $1.63.

The shares hit a 52-week high of $5.61 in October, not long after the distiller completed the first stage of a capital raising, collecting $45.5 million from newly issued shares.

The company has a market capitalisation of $271 million.

Motley Fool contributor Alice de Bruin has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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