New Sprint CEO Axes Top of Executive Tree

Dan Hesse Sprint's S (NYSE) new CEO has begun to show his hand with a management shakeup at the top as well as overall. He has quickly stepped up to the plate and made some difficult but necessary first decisions. Early today, Sprint announced that three top executives would be leaving the company - Paul Saleh, CFO (Saleh served as interim CEO after Fossee the previous CEO was finally forced out), Tim Kelly, CMO and Mark Angelino, president sales & distribution. Hesse in the press release indicated he would work to find permanent replacements for these executives. In the interim, controller, William G. Arendt will serve as acting CFO, John Garcia, SVP of product development and management will serve as acting CMO and Paget Alves, regional president for sales and distribution will be acting president of sales and distribution.

The three major executive changes come shortly after the company announced plans to layoff nearly 4,000 employees and close 125 of its retail stores as a response to the firm's hemorraghing subscriber base and declining share price.

Shareholders who continue to see their investment decline in value can at least see a ray of hope for the future. Hesse has taken charge. He has already made moves to begin the effort to turn the ship around. As I said in my earlier posts, the real question is whether there still is enough time left to turn things around and whether strategy decisions and their execution will be sufficient to save Sprint-Nextel.

Stay tuned more big changes can be expected. Rumors continue that Sprint may lower its prices to gain new subscribers. A strategy which in itself might be more problematic than just going forward as they now stand.

CEO Watch - Sprint Nextel Update 3, New CEO Appointed

Sprint Nextel Corp S (NYSE) selected Embarq Corp EQ (NYSE) CEO Dan Hesse as its new president and chief executive. Hesse, 54, is somewhat familiar with Sprint. He worked at the company's local phone service division for a year before it was spun off to create Embarq. A number of analysts considered Hesse a potential candidate to replace Gary Forsee, who resigned as Sprint CEO in October. Forsee left the firm after the company bled customers for more than a year and lost market share to rivals.

Hesse's appointment seems to have been a safe choice. It's unclear whether safe is exactly what Sprint really needs at the moment. At least the waiting is over and the company can now start to move on to make the necessary decisions to try and get itself back on track. Hesse's appointment comes after it became known that Sprint rejected a $5 billion offer after it had been approached by former Sprint Chairman Tim Donahue, South Korea's SK Telecom Co Ltd and Providence Equity Partners.

Investors need to keep an extremely close eye on Hesse and his team as we move forward. Sprint remains in trouble and we will just have wait and see what the new management can do to reverse the firm's problems.

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