The King Is Dead - Long Live the Queen
Apotheker is ousted at HP and Meg Whitman takes the helm. Wow, what a surprise that was! After 11 months at the helm Leo Apotheker has been ousted as CEO of HP. But I’m not feeling too sorry for Leo as he stands to receive cash severance of at least $7.2 million, a figure that could be higher if his annual bonus was set above the minimum $2.4 million laid out in the employment agreement. Including his $1.1 million in salary received for the first year, along with a $4 million cash signing bonus and a $4.6 million relocation payment, Apotheker will have earned about $34.7 million in cash and stock for less than a year’s work.
And in return HP shareholders have seen their share price plummet 47% in the same time, a company in turmoil and a crisis both of leadership and of strategic direction. Whitman has committed to maintaining the direction set by Apotheker and carry on down the path of re-creating the manufacturing beast that was HP into a services company like IBM.
Who is the new Queen?
Who is Meg Whitman and is she up to the job?. It would seem to matter little to the board of HP as she is the fourth CEO in five years following on from Carly Fiorina, Mark Hurd and now Leo Apotheker - I wonder if she signed a pre-nupe before accepting the job?
Meg Whitman joined the board of HP in January after losing out in the battle to become Governor of California and is probably best known as an ‘internet pioneer’ after building eBay into the world’s largest internet auctioneer with a market value of about $40 billion. She may have overpaid for Skype and sales were faltering when she left, but it’s always easy to criticize with hindsight. However, to my mind if you are in line to pick up nearly $35 million after less than a year’s work, the board might expect you to be able to set the agenda rather than react to events.Continued on the next page