After less than a year on the job, Lockheed Martin Corp. CFO Phil Duke has been replaced by Robert J. Stevens, formerly VP of strategy. Duke won’t say if he was involved in the decision to move him out of the CFO spot. The move was part of a massive restructuring announced in September, which Lockheed claims will diversify the company, streamline operations, and combat a series of quality problems. Duke was moved to the newly created position of EVP of shared services. Currently, Lockheed Martin has shared services for operational units, but Duke’s goal is to institute shared services companywide.
Changing Menu Items
James E. Healey must be one sharp cookie. That’s what the board of directors at Nabisco Group Holdings thinks. In September, the board elected Healey to SVP and CFO, replacing David Rickard, who left the Parsippany, N.J.-based snack-food maker.
C. Larry Pope went hog wild when Smithfield Foods Inc. announced his new corporate role. Pope, 45, was promoted from VP of finance to finance chief, effective September 1. He takes over for Aaron D. Trub, 65, who has retired from the Smithfield, Va.-based hog producer and pork processor.
Food and finance go hand-in-hand for Mark L. Mestayer. Mestayer, a former director of finance and secretary for Piccadilly Cafeterias Inc., recently assumed the role of CFO. He takes the tray from Fred Johnson, 48, who was named EVP, secretary, and treasurer at the cafeteria concern.
Greg Uhing, 36, has strutted on into the corporate coop at Boston Chicken Inc. Uhing was promoted from treasurer and corporate controller to the CFO position at this restaurant company, which operates out of Golden, Colo. He succeeds Lawrence E. White, 49, the new CFO of CBRL Group Inc., which operates Cracker Barrel Old Country Stores.
Finance With Flair
Helen Murphy will be sharing helpful finance hints at the corporate office of Martha Stewart Living Omnimedia LLC. Murphy joins the New Yorkbased multimedia firm from Westvaco Corp., where she served as SVP and CFO.
Looks like Ann Mather belongs in Disneyland. Mather, who has served as SVP of finance and administration at The Walt Disney Co.’s Buena Vista International Theatrical Division, has been named finance chief at a Disney associate, Pixar Animation Studios. She inherits the role at the Richmond, Calif.- based computer animation company from Lawrence Levy, who retired in April.
Cost-U-Less Inc., based in Bellevue, Wash., took some in-house inventory and came up short a CFO. That’s why this operator of warehouse stores selected Roy W. Sorensen, 46, to fill the vacant slot. The former CFO and treasurer at Drug Emporium Inc. replaces interim finance chief Martin Moore, who will retain the controller title.
John L. Hendrix is serving time as the new VP and CFO of Cornell Cos., in Houston. Hendrix succeeds Steven W. Logan at this provider of correctional and detention facilities. Logan, CEO, has been acting CFO since the departure of Brian Bergeron in May.
———————————————– ——————————— Some Good Investments
Mark P. Brockelman is moving on from CFO Services Inc., where he served as a consultant. The 44-year-old executive has been named CFO of Mobile America Corp., a Jacksonville, Fla.-based insurer. He replaces Tom Stinson, who resigned in April.
The corporate office of United Dominion Realty Trust Inc. has put its trust in new EVP and CFO A. William Hamill. Hamill’s last CFO post was at Wayne, N.J.-based Union Camp Corp.
The head honchos at Wm. Wrigley Jr. Co. chewed it over, and stuck Ronald V. Waters in the EVP and CFO slots. The former corporate controller of Gillette Co. replaces John F. Bard at the chewing-gum maker in Chicago. Bard remains as EVP.
After just one year as CFO of PacifiCare Health Systems Inc., in Santa Ana, Calif., Robert B. Stearns has called it quits. Stearns hoped to develop the managed-care pro-vider’s consumer business, but had a “different vision” from PacifiCare’s, says a company spokesperson.
———————————————– ——————————— Corporate Firefighting: Meet Mr. Fixit
Hap Stephen likes a good challenge. So, when institutional investors of struggling paper company Repap Enterprises Inc. asked him to replace Steven Berg as chairman of the board, 52-year-old Stephen didn’t hesitate.
As his first order of business, Stephen will be responsible for heading up litigation regarding a contract dispute with former chairman Berg, a dispute that has occupied Repap Enterprises and CEO Stephen Larson for the past several months. Berg, 64, contends his pay package, which includes a $420,000 annual salary, a signing bonus of $1.25 million worth of company shares, and additional bonuses based on the market capitalization of the company, is a fair deal. But some shareholders claim it’s “too rich.”
Berg denounced the critics as “trying to undermine the company for their own benefit.” And, in August, shareholders refused to reelect him as chairman at the company’s annual meeting.
Stephen, CFO of troubled Canadian firm T. Eaton Co. Ltd., will be tackling the heated quarrel before moving on to his own area of expertise, restructuring. He hopes “to address [Repap’s] capital structure” and continue the company’s much-needed reorganization. Stamford, Conn.-based Repap lost $22.8 million this past year, operating under about $1.2 billion in debt.
The king of corporate overhauls, Stephen has been involved in several large Canadian restructurings, including Eaton, St. Mary’s Paper, Algoma Steel, Beatrice Foods, and Dylex. He takes this latest challenge in stride. Says the eager executive, “There’s trouble, but that’s what keeps it interesting.”
———————————————– ——————————— Maximum Return
It’s back to the private sector for Leonard Thill. The former assistant chief accountant for the SEC’s enforcement division was recruited as CFO by Maxim Group Inc., a floor- covering retailer in Kennesaw, Ga., in September.
But Thomas P. Leahey, Maxim’s EVP and treasurer, insists that the choice of a replacement for outgoing CFO Gary Brugliera was not influenced by the “informal inquiry” conducted by the SEC of Maxim in July. The inquiry, which looked into the company’s accounting practices, was launched after Maxim announced plans to restate its fiscal 1999 earnings. Leahey says Thill, a 12-year veteran of the SEC, was not involved in the inquiry.
“It wasn’t done because of the restatement,” says Leahey. “Those are issues of the past. We just think that from an operating perspective, he’ll be a key player.”
The issues aren’t as far in the past as Maxim would probably like. The company restated its earnings in October, revealing a much larger loss than was previously declared. The revised numbers show a loss of $19.6 million, or $1.10 a share, compared with its previously stated loss of $3 million, or 17 cents a share. The company blames prematurely booked revenues as the culprit.
As CFO, Thill will also face a class-action suit filed in May by stockholders who accuse Maxim executives of misinforming them about earnings during 1998, and selling stock just before the company announced its intention to restate.
Thill will also need to focus on helping the company’s stock price. After hitting a 52-week high of $25 in January, Maxim’s stock hit a low of $4 in September, and at least one firm has suspended analyst coverage.
———————————————– ——————————— New Game Plans
George Mihalko is now a major-league player at Sports Authority Inc. The sporting-retailer, headquartered in Fort Lauderdale, Fla., drafted the 44-year-old Mihalko to replace Anthony Crudele as CFO. Mihalko was previously CFO of Omaha-based Pamida Holdings Corp.
Bryan D. Reed is a happy camper these days. The chief accounting officer at Dallas-based Thousand Trails Inc. was recently promoted to VP and CFO. Reed, 42, succeeds Harry White, 45, who left the operator of membership-based campgrounds to pursue a career at Silverleaf Resorts Inc.
Barry W. Hall is in vogue as the new EVP of finance and CFO of Styleclick.com Inc., in Los Angeles. Hall takes over for Lee Freedman, who has moved into the EVP post at the operator of E-commerce Web sites. Hall previously served as EVP and CFO for Earthlink Network Inc.
James B. Arnold, former CFO of AT&T Solutions, has been called to a new CFO post at Netivation.com Inc. Arnold, who currently serves as Imagination Software Inc.’s finance head, replaces Leo Burch at the Inter-net public-policy and health-care-technology firm in Washington, D.C.
In yet another Internet tale, Ameritrade Holding Corp. CFO Robert T. Slezak has announced he will retire later this year. Slezak, 42, is leaving the Omaha-based online broker to pursue other interests. However, he will remain on the board as a consultant. A search firm has been hired to find his replacement.
———————————————– ——————————— Moving Up and Out
As reported in Grapevine in September, Samuel Siegel, currently CFO at Nucor Corp., will retire at the end of the year. That’s good news for VP and corporate controller Terry S. Lisenby, who is expected to replace him. Meanwhile, VPs Dan Dimicco and Hamilton Lott have also changed titles. The two moved into EVP positions at the Charlotte, N.C.-based steelmaker in early October.
Salvatore F. Sodano has the whole Wall Street world in his hands. The Brooklyn native has accepted the roles of chairman and CEO at the American Stock Exchange. He also joined the board of the National Association of Securities Dealers, and retains the title of COO there. Sodano no longer operates as the NASD’s CFO, however, and the search is on for his successor.
———————————————– ——————————— Life After CFO: CFO Quits; Stock Dips
A fantasy sequence for a veteran finance chief: after many years of loyal service, you decide to do something entrepreneurial. Then, on the very day you announce your resignation, your company’s stock tanks, making national headlines.
But that’s the reality John F. “Jack” McGovern, CFO of Georgia-Pacific Corp., faced in late September, when he announced his resignation to start an investment and consulting business. The day of his announcement, the stock of the paper- and building-products giant dropped by 13 percent. McGovern is held in high regard by Wall Street as a financial disciplinarian, so naturally the press drew a causal link. But there was a little more at play. That day, two analysts also reduced their third-quarter estimates, which obviously had a market impact.
McGovern, 53, took a pass at explaining the events of that day (“I don’t want to touch that”), but he was interested in discussing his new venture, Aurora Capital LLC, which he’s creating with a former colleague from Georgia-Pacific. “We’ll be taking equity positions in smaller firms, where we can leverage our experience,” says McGovern. The company, which will be based in Atlanta, will also do business-strategy consulting. “I really want to try something different,” he says, adding that he wants to apply his financial expertise outside the walls of a big company like Georgia-Pacific, where McGovern has worked for 18 years, the last 5 as CFO. He says he is proud of the role he played in helping develop a shareholder-oriented culture at Georgia-Pacific by implementing EVA-like concepts. McGovern also played a major role in restructuring the company’s Timber Co. unit into a tracking-stock, which he says added value to the company.