To lose one FTSE 100 chief executive in a week is unfortunate. But to lose two could look careless.
Just days after the brutal defenestration of Reed Elsevier’s Ian Smith, Rexam, the world’s biggest drinks can manufacturer, announced on Friday that its CEO, Leslie Van de Walle, was leaving to “develop his non executive interests“.
Too firm a comparison between the two exits, though tempting, would be harsh. Mr Smith got the chop just eight months into the job, whereas Mr Van de Walle has left after a three-year term.
But the timing makes some comparison inevitable.
Mr Van de Walle may not have been canned, but both he and Mr Smith had pushed through refinancings this year that had been unpopular with some shareholders.
Reed’s £824m placing went down like a tonne of bricks with the market. Rexam’s £350m rights issue, pushed through in July to avoid losing its investment grade credit rating, though better supported, was far from universally popular.
Some of Rexam’s shareholders were known to be less than impressed that a purportedly defensive company found itself leveraged enough to need a cash call when the cycle turned.
Rexam on Friday morning are distancing the company from the events at Reed, with a company spokesman stressing that Mr Van de Walle “was absolutely not pushed out by shareholders, and his departure is not related to the rights issue”.
Nevertheless, after a frenetic 12 months worth of cash calls in the City it would not be a surprise to see a couple more FTSE 100 CEOs leaving to concentrate on other interests.
Institutional investors, not always renowned for their long memories, may yet take retribution further down the line. So the message to CEOs in the housebuilding, media and industrial sectors is be afraid, be very afraid.
Related links:
Rexam chief executive to step down – FT
Boardroom execution at Reed – FT Alphaville