Sprint Hopes New CEO Hesse Can Reverse Predecessor's Failures

After more than two months in corporate governance limbo, Sprint Nextel (S) announced Tuesday current Embarq Corp. (EQ) CEO and Chairman Dan Hesse would take over as its new CEO and President effective immediately. Gary Forsee stepped down as Sprint’s top executive during the second week in October (full story). Shareholders hope Hesse can reverse the failures of his predecessor, which saw repeated market share losses to larger wireless carriers AT&T (T) and Verizon (VZ), falling profits and widespread complaints of inferior network coverage and customer support.

Hesse comes to Sprint with a lifetime of wireless business managerial experience. Before taking the helm at Sprint spinoff Embarq, he spent 23 years at AT&T, serving as President and CEO of AT&T Wireless Services from 1997-2000, then the nation’s largest wireless provider. According to Tuesday’s Wall Street Journal, “Mr. Hesse has earned high marks from Wall Street for his stewardship of Embarq.” Board member Irvine O. Hockaday, Jr., who chaired Sprint’s CEO search committee, believes Hesse “is a proven leader with deep wireless experience as a chief executive and an established track record of generating strong operating performance. He has the board’s full support to take decisive actions necessary to improve our performance.” Sprint shares fell 1.1% on the news Tuesday; they are lower 26% YTD. Embarq shares were slightly lower on the news; they are lower by 9.4% YTD.

Sources: Press release, Wall Street Journal, Portfolio.com, Embarq Bio
Additional Reading: Sprint Nextel Q3 2007 Earnings Call Transcript ? Sprint CEO Out; Guidance Lowered

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