Management Turnover as Change Agent

Tuesday, February 23, 2010

Technitrol Takes on New CEO To Watch

Technitrol TNL (NYSE), a worldwide producer of electronic components, appointed Daniel M. Moloney to be its new CEO. Moloney most recently has been an executive vice president with Motorola and the president of its Home and Network Mobility business. Moloney replaces James M. Papada III who has been the firm’s CEO and chairman. The compDan Moloneyany has been planning for the succession for a long time. Technitrol appears to have made a good choice for its next top executive.

Moloney had spent ten years at Motorola in a variety of high level positions. The announcement that Moloney will be leaving Motorola comes shortly after the firm made it formal in early February that it would be split into two independent companies. One company to be headed by Sanjay Jha, currently the co-executive of Motorola, would run the mobile phones and setboxes. This was the company Moloney would have worked for if he had not decided to leave Motorola and become CEO ofOne year Stock Performance of Technitrol Technitrol.Moloney appears to have the skills and background to run Technitrol. Keep a close eye on his moves for the next year once he gets up and running.

Friday, February 19, 2010

Energy Solutions CEO Resigns - Stock Tumbles

Earlier today Energy Solutions Inc. ES (NYSE) announced that the firm's CEO and Chairman, Steve Creamer, had resigned his position effective immediately. The nuclear waste storage firm's stock price plummeted today. Creamer's resignation comes just two months after the firm's CFO, Philip Strawbridge, had resigned. The company immediately replaced Creamer with Val Christensen, who has been serving as the firm's president since 2008 and was previously evp and general counsel. The apparent abrupt management change was examined in a story by Bob Mims for the, The Salt Lake Tribune,
...slide may have prompted the new chief executive and the board to hold a quickly-announced teleconference call at mid-morning out of Boston, in which Christensen stressed that Creamer's departure - though coming earlier than expected - had been part of a succession plan approved by the board early last year.

"This was going to happen this year," Christensen said. However, he flatly refused to release detailed information on the reasons for Creamer's admittedly "abrupt" decision to resign some one to five months earlier than originally scheduled. Christensen said Creamer made his decision during a board meeting on Thursday.

"About a year ago, I was made [EnergySolutions] president as part of a longer term succession plan. The board and CEO Steve Creamer identified me as the most likely candidate. Steve's plan throughout the [past] year was to depart the company sometime in the spring or summer [of 2010]."

The dramatic management change requires investors to keep an extremely close eye on next week's fourth quarter earnings announcement and moves that top management takes over the next six to twelve months.

Monday, February 8, 2010

John Thain Gets Second Chance

John Thain, the former CEO of Merrill Lynch, who found his reputation in tatters after Bank of America acquired Merrill in the midst of the financial crisis, has been given a second chance to revive his reputation. Yesterday, CIT Group CIT (NYSE) announced that Thain would immediately become the new CEO and chairman of the small business lender. CIT had gone into bankruptcy under the leadership of Jeffrey Peek who ultimately had to give up his leadership role of the firm.CIT has been a very important lender to small and mid-sized businesses. It finds itself coming out of bankruptcy and hopes Thain can work wonders with the firm. An article in Forbes summed up Thain’s situation with regard to the Bank of America acquisition of Merrill and how it impacted his reputation and firm.John Thain

As chairman and CEO of Merrill Lynch, Thain’s deal to sell Merrill was considered a lifesaving move for the company at the height of the financial crisis. But he then came under fire for having paid out $3.6 billion in bonuses to Merrill employees just before the deal closed, and for spending more than $1 million to redecorate his office at Merrill, despite its massive losses.

CIT announced yesterday, as the firm moves out of bankruptcy, that Thain would serve as the firm’s new CEO aOne year Stock Performance of CITnd chairman. Thain replaces interim CEO Peter Tobin who will remain on the company’s board of directors. The decision to select Thain may actually be a good fit. Thain’s expertise could actually be very beneficial to CIT’s circumstances.

Friday, February 5, 2010

What's Behind the Sudden Departure of PSS World Medical's CEO?

Wednesday of this week, PSS World Medical Inc. PSSI (NASDAQ), a medical distributor company, unexpectedly annoDavid Smithunced the immediate departure of its CEO and Chairman, David A. Smith. Smith who had been with the firm since 1987 and was appointed CEO in 2002 and later his Chairman in 2007 has left the firm with virtually no comment. The company selected Gary Corless, another long term employee and the current COO, to replace Smith as CEO. The company also appointed Delores Kesler, a director since 1993, as the new chairman.Smith’s sudden and unexpected departure had an immediate negative One year Stock Performance of PSS World Medicalimpact on the company’s stock. Smith’s departure comes according to Kimberly Morrison, a reporter for the Jacksonville Business Journal,

The management change comes on the heels of several strong quarters of financial performance for thGary A. Corlesse company. Despite a difficult environment, the company’s fiscal 2010 earnings growth is expected to be more than 30 percent.

PSS World Medical, a Jacksonville-based distributor of medical products, reported net income for the nine months ended Jan. 1 was $52.9 million, a 40.3 percent increase from the same period the year before. Although the third quarter results were slightly below analyst expectations, Kreger said the confirmed guidance suggested accounting and financial performance was not behind the change.

Investors will continue to wonder what exactly was behind the sudden change at the firm. Corless, the new CEO, worked quite closely with Smith and is likely to continue the policies Smith put in place. Anyone interested in this sector or specific company needs to stay on top of ongoing events. The reasons for Smith’s departure will more than likely come out.