Corporate Finance

Say Good-bye to the Maytag man

Man At The Top
CFO StaffJanuary 1, 2000

Man At The Top

AT&T Corp. called on a prominent Hughes Electronics Corp. executive to lead its corporate office. Charles Noski, 47, was named CFO of the Basking Ridge, N.J.-based telephone and cable-television conglomerate. The former president and COO of Hughes succeeds Daniel Somers, who will head up AT&T’s Broadband and Internet unit. (Read Full Article.)

David P. Alderson slipped out of Pennzoil­ Quaker State Co., the car-products concern based in Houston. The 50-year-old CFO plans to retire to look for a job with “more personal upside.”

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Donald Blair, 41, can do anything you can do better. In fact, Blair is ready to accept the challenge at Beaverton, Oreg.-based Nike Inc., where he has been named VP and CFO. The former SVP of finance for the Pepsi-Cola Bottling Group fills the shoes of Robert Falcone, who resigned in January 1998.

Seals M. McCarty has glided into the SVP and CFO slots at Santa Fe International Corp., following the retirement of 65-year-old Donald G. Barber. McCarty, 53, was formerly VP and controller at the Dallas-based oil-drilling concern.

Spin City

Detroit-based Visteon Automotive Systems is pulling away from Ford Motor Co., and it’s taking some key executives along for the ride. Ford’s director of accounting, Dan Coulson, 56, will become CFO of the new entity, and Bob Marcin, executive director of labor affairs, will take charge of personnel and labor at Visteon.

Another major spin-off that’s in the works is ANC Rental Corp. The new company, comprising Alamo Rent A Car, National Car Rental, and CarTemps USA, is separating from AutoNation Inc. Kathleen Hyle, previously AutoNation’s treasurer and VP, finance, will serve as CFO of ANC, which is headquartered in Fort Lauderdale, Fla.

A Business Buffet

Sara Lee Corp. has made a significant change in its corporate kitchen. Gary D. McMillan, a former managing partner at the Chicago office of Arthur Andersen LLP, was named chief financial and administrative officer of the Chicago-based food and consumer-goods producer. He succeeds Judith A. Sprieser, who replaces James R. Carlson as CEO of the company’s Sara Lee Foods and Food Service operations.

Fast-food titan Tricon Global Restaurants Inc. is serving up a new CFO. David Deno, formerly CFO of international business, was chosen as finance chief, replacing Robert C. Lowes at the Louisville-based operator of KFC, Pizza Hut, and Taco Bell restaurants.

ITT Industries is also pleased to announce its new CFO hire. The White Plains, N.Y.-based engineering/manufacturing company selected David J. Anderson to fill the SVP and CFO roles. The CFO position has been empty since the September 1999 departure of Heidi Kunz, who left to become The Gap Inc.’s finance chief.

Scapegoat Alert

Good-bye, Mr. Maytag

Say good-bye to the Maytag man. Gerald J. Pribanic, the 56-year-old CFO of Newton, Iowa- based Maytag Corp., has resigned in order to “pursue other opportunities.” According to reports, Pribanic, who has been with the household-appliance company since 1996, is leaving on amicable terms. But some industry experts disagree. The reason? Pribanic’s November departure came just one month after the company’s stock took a plunge from 741/4 to 311/4. The disappointing figures failed to meet Wall Street’s expectations, but more important, Maytag’s corporate office failed to forewarn the Street. Maytag officials, led by CEO Lloyd Ward, tried to defend the company’s actions, which caused much hostility among analysts. That wasn’t the end of it. Two weeks after the earnings announcement, Pribanic was asked to move into the controller position, but he refused. Pribanic denies that the title change had anything to do with the earnings scandal. Others aren’t so sure. In fact, Efraim Levy, an analyst at S&P Equity Group, says Pribanic was most likely the fall guy for an earnings shortfall. “[Maytag] had just gotten a new CEO–Lloyd Ward–then suddenly it missed the numbers,” says Levy. “It’s not helpful to make the boss look bad that quickly.” Maytag is searching for Pribanic’s successor.

Till Death Do Us Part?

After mourning a year of bad earnings, Houston- based funeral home and cemetery company Service Corp. International has now lost its CFO. George Champagne, 46, resigned in November after a series of missed earnings reports. Champagne joins former president and COO L. William Heiligbrodt on the list of recently departed upper managers.

Although the death biz is typically stable, Service Corp. joined an industrywide buying spree in 1997 and 1998. “The whole industry was overpaying for acquisitions,” says Linda Bannister, an analyst with Edward Jones, in St. Louis. “When it came time to grow operationally, the house of cards came tumbling down.” So has Service Corp.’s stock price, from a high of $39 down to around $7. Service Corp. stock lost 44 percent in one day in January 1999, when it issued a severe earnings warning. It fell short again in the third quarter, and recently announced a hit to fourth-quarter earnings and dismal growth prospects for 2000.

Integrating mergers has also been a problem at Service Corp., says Bannister. And although death doesn’t take a holiday, the death rate has slowed, says William Burns, an analyst with Johnson Rice and Co., in New Orleans.

The death-rate dip isn’t the only cause of Service Corp.’s woes, says Burns. Funeral homes are a high fixed-cost business, he says, adding that “a little change in volume can [create] a big change in operating profit.”

Champagne joined Service Corp. in 1988 and became CFO in 1995. He is expected to maintain his relationship with Service Corp. as a consultant.