Tuesday, January 8, 2008
Three troubled companies are starting the new year with leadership changes -- Bear Stearns, Sallie Mae, and Starbucks.
At Bear Stearns, James E. Cayne will step down as CEO, but remain Chairman. The new CEO will be Alan Schwartz, currently the President. Bear Stearns, you will recall, has suffered mightily from the mortgage crisis. Its trouble began last summer with the collapse of two hedge funds and have only continued. It posted its first quarterly loss ever in fourth quarter 2007. Besides all this, Cayne's work ethic was questioned as he took time off during crises to play golf and bridge. NYTimes, Bear’s Cayne to Quit as Chief Executive.
At Sallie Mae, Anthony P. Terracciano, a long time bank executive with a reputation for turning around troubled companies, becomes Chairman, succeeding Alfred L. Lord, who will stay on as CEO. Sallie Mae's troubles include a busted LBO with J.C. Flowers, rising default rates on student loans, and tighter credit markets. Lord did not help matters with a recent disastrous conference call that ended with an expletive. NYTimes, A Chairman Is Appointed to Rebuild Sallie Mae.
Finally, at Starbucks, Howard D. Schultz, currently Chairman, becomes CEO, and current CEO James L. Donald will leave the company. Schultz, who has been with the company since 1982, promises rededicated focus on the Starbucks brand, as it faces increasing competition from McDonalds and Dunkin' Donuts. NYTimes, Starbucks Replaces Chief With Chairman.