Hi & Bye

In the past year, two chief financial officers have departed Oracle.
CFO StaffDecember 1, 2005

Why is Oracle having so much trouble hanging on to CFOs? In just over a year it has seen two of them flee — first Harry You and now Gregory Maffei, a former CFO of Microsoft. Various rumors, mostly centered on personality clashes, are circulating to explain Maffei’s short stint.

A more likely explanation is simple ambition. Both You and Maffei left to take on CEO roles — You at BearingPoint and Maffei at Liberty Media Corp. next year. It probably didn’t help that Oracle is chock-full of CFO types. Pat Walravens, an analyst with JMP Securities LLC, points out that Oracle’s top management team already has three other finance experts: Jeff Henley, who was CFO for 13 years prior to You; Safra Catz, who is co-president and a former interim CFO; and Charles Phillips, another co-president. “All [have] the skill sets to do things like M&A that you’d expect the CFO to do,” says Walravens. “That was probably frustrating for Maffei.”

And there’s the fact that Maffei constituted a third co-president. According to Brent Williams of KeyBanc Capital Markets, Oracle elevated the CFO position with the idea that Maffei could also help with deals. “But when you have three co-presidents — a former sell-side analyst, a former investment banker, and a former company guy with deal-making experience — you may find that no one knows exactly what his turf is, so collisions can result.” Of course, they all then report to über-CEO Larry Ellison. Says Peter Crist of executive search firm Crist Associates, “It’s a very unusual structure.”

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At least Maffei won’t have to worry about that problem in his new job: Liberty Media will have only one CEO. — Don Durfee

Short Fuse

Not since former Enron president Jeffrey Skilling called an analyst a choice expletive back in 2001 have analyst calls been so entertaining. But the recent outbursts of Patrick Byrne, the CEO of Salt Lake City–based, are also indicative of the hostility many in finance feel toward short-sellers.

Since last February, Byrne has been using his conference calls to address the effect of naked short-selling on company stock price. (Overstock is trading at about $34, down from a peak of $76.) But on August 11, he took it one step further, announcing his intent to sue Rocker Partners and Gradient Analytics for unfair business practices. Byrne even mapped out a “miscreants ball” of short-sellers, hedge-fund managers, and financial journalists.

But Byrne may just be fueling the fire — the stock is down 17 percent since August. “The short-sellers hit a nerve and will only step up efforts because they smell blood,” says Tom Murphy, a partner at McDermott Will & Emery LLP.

Curiously, senior vice president of finance David Chidester (who remains almost mum during conference calls and refused CFO’s requests for an interview) has managed to avoid the controversy. “Byrne has never put David in a position of having to discuss the situation,” says Rebecca Kujawa, an analyst at Stanford Group Co., which has a “hold” rating on the stock. “David is solely focused on the company’s finances, as he should be.” — Laura DeMars

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