Sprint Nextel chairman and CEO Gary Forsee stepped down Monday, and the company appointed chief financial officer Paul Saleh acting chief executive until it can find a replacement.
Forsee’s resignation came after press reports last week that the company’s board was actively looking for a CEO to replace him. Board member James Hance Jr., 63, will assume the role of acting non-executive chairman and lead independent director.
“On behalf of the entire board and the Sprint Nextel employees, we want to thank Gary for his dedication and leadership and all of the contributions he has made since becoming chief executive of Sprint in 2003,” Sprint board member Irvine Hockaday said, in a statement.
According to Hockaday’s statement, the decision to seek a new CEO was “based on the board’s belief that it is the right time to put in place new leadership to move the company forward in improving its performance and realizing corporate objectives.” Sprint will focus its CEO search on candidates outside the company, he added.
Sprint’s announcement did not include a statement from Forsee.
In addition to Forsee’s departure, the company announced that it expects to report a net loss of approximately 337,000 post-paid subscribers in the third quarter, and that it expects operating income and consolidated operating revenue for 2007 to be “slightly below the range of previously provided guidance.”
The carrier previously expected 2007 consolidated operating revenue of $41 billion to $42 billion and operating income before depreciation, amortization, restructuring and asset impairments, and special items to be $11.0 billion to $11.5 billion. Sprint expects to release third-quarter financial results on Nov. 1.
At Sprint, Forsee formed the Pivot joint venture with four cable operators – Comcast, Cox Communications, Time Warner Cable and Advance/Newhouse Communications – to offer mobile-phone service. This summer Forsee said the joint venture, announced in November 2005, was “a disappointment” in terms of the length of time it has taken to offer service commercially.
Forsee was named Sprint’s CEO in March 2003. Previously he was vice chairman of BellSouth, responsible for the phone company’s domestic operations, and was chairman of the Cingular Wireless joint venture with SBC Communications. (Both BellSouth and SBC are now part of AT&T.)
Sprint’s board is hoping to announce a new CEO as soon as early December, according to a report last Thursday by The Wall Street Journal.
Saleh, 50, has served as CFO of Sprint since the merger of Sprint and Nextel Communications in 2005. Previously he was executive vice president and chief financial officer for Nextel since joining the company in 2001. Before joining Nextel, Saleh CFO for Walt Disney International from 1997 to 2001.
