Hewlett-Packard made widespread changes to its board of directors yesterday and in doing so seems to be looking beyond the Mark Hurd era, once and for all.
HP announced Joel Hyatt, John Joyce, Robert Ryan and Lucille Salhany were not standing for re-election at the company's annual stockholders meeting in March. In their place will be Shumeet Banerji, Gary Reiner, Patricia Russo, Dominique Senequier and Meg Whitman.
The addition of these new directors will further diversify the outstanding talents and wide-ranging experience that our directors already bring to HP, Raymond J. Lane, non-executive chairman of the board of directors, HP, said in a statement.
While HP did not explain the statement, media reports say the board shakeup has a lot to do with former chief executive officer Mark Hurd. Back in August, Hurd was ousted as the CEO of HP for violating company policy, which came after the board investigated a sexual-harassment claim against Hurd by a contractor.
According to media reports, the outgoing directors were Hurd supporters. The Wall St. Journal says Hyatt and Joyce were Hurd's biggest supporters and did not think forcing him out was a good idea.
I think the Mark Hurd thing is part of it, said Jayson Noland, equity analyst at Robert W. Baird. A couple of the directors were Hurd appointees and they were big Hurd supporters. I think that's part of it. They have put in a new chairman, a new CEO and a new direction for the company. I think it's healthy to bring in new energy.
Noland said from a pure speculative standpoint, it is possible HP got rid of the Hurd supporters on the board because the company thought they might share information with him. Hurd currently works for HP's rival, Oracle.
Ben Reitzes, analyst for Barclays Capital, also said this move may have had something to do with Mark Hurd. While the company is indicating that the Mark Hurd situation had nothing to do with the change and that the departures were voluntary, we believe that Joyce and Hyatt in particular were loyal supporters of Hurd, Reitzes wrote in a note.
While the incoming directors don't definitively say anything about where HP is headed, Noland say the new faces clearly represent a new direction. The incoming board directors have a diverse background from telecom to internet and private equity. It's likely, he says, the company will focus on enterprise. Russo, the former CEO of Alcatel-Lucent, may have been brought in to help HP compete with Cisco in the networking enterprise segment Noland says.
Reitzes also said with these board appointees, Apotheker is putting greater emphasis on enterprise technology assets.