After months of steadily declining stock prices, Global Crossing Ltd. Chief Executive Officer Leo Hindery resigned Wednesday. Vice Chairman Thomas Casey will take Hindery’s place.
Hindery, former head of AT&T Corp.’s cable television operations, had only been at the job seven months. He joined Global Crossing last December and succeeded former CEO Bob Annunziata in March. But in the past few months, Global Crossing stock has tumbled from a 52-week high of $61 13/16 to a 52-week low of $20 1/8 in morning trading Wednesday.
Global Crossing, which is building an undersea and land-based global fiber optic telecommunications network, said Hindery resigned by mutual consent.
Hindery will remain in his role as chairman and CEO of GlobalCenter, the company’s Web hosting subsidiary, until the completion of GlobalCenter’s sale to Exodus Communications, expected early next year.
“I have done what I set out to do at Global Crossing — improve operating management and rationalize operating assets, realize the value of GlobalCenter, and meet or exceed quarterly financial goals,” Hindery said.
Casey, 48, will be the company’s fourth CEO since it was founded about three and a half years ago.
“My intention is to stay here for the rest of my career,” Casey said Wednesday morning, seeking to assure investors.
Casey is also a director of Global Crossing as well as a member of its Office of the Chairman. His past experience includes a period as co-head of Merrill Lynch’s global telecommunications banking group and co-head of the worldwide telecommunications legal practice at Skadden, Arps, Slate, Meagher & Flom.
“With the pending merger of GlobalCenter, the board and I believe Tom Casey is the ideal executive to help us take full advantage of Global Crossing’s unique market opportunity,” said Gary Winnick, the company’s chairman and founder. “He has extraordinary telecommunications experience, excellent judgment and leadership abilities, in-depth knowledge of every facet of our business, and a proven ability to work with me and the superb management team we have built together.”
The Hamilton, Bermuda-based company has yet to show a profit. According to First Call/Thomson Financial, analysts expect to see a loss of 71 cents per share in the third quarter and a $2.56 per share loss for the year. Last year it had a third quarter loss of seven cent per share and a full-year loss of 37 cents per share. But Casey said the picture is not so dire.
“With the buildout of the Global Crossing network now nearly complete, and our management infrastructure in place, we have an extraordinary opportunity to meet or exceed our recently increased projections for the third quarter and full year, and we are well positioned for 2001 and beyond,” he said. “Our IP network is the only broadband network extending from East Asia to Eastern Europe and designed from the outset to operate seamlessly worldwide. Our data and IP products are rolling out as we finish the network and are targeted to best meet the needs of the increasing number of global businesses turning to the Internet to improve their operations. I believe we can build substantial shareholder value by capitalizing on the world-class assets Global Crossing has created over the past three years.”
