Mike Zafirovski, the CEO of Nortel Networks, has precipitately resigned, leaving the sale of remaining assets unfinished and what's left of the 114 year-old company rudderless and in limbo. So much for his much-vaunted and oft-promised "unqualified, continuing commitment". He's not being replaced, reports Martyn Warwick, after all, what would be the point?
Other are voting with their feet as well. Two thirds of the board of directors went with Zafirovski, including Harry Pearce, Nortel's Chairman. The sudden resignations came as Nortel reported yet another appalling loss, this time of US$274 million for the quarter ended July 30. That's more than double the dreadful loss posted for the same period in 2008. Talk about re-arranging the deck chairs on the Titanic.
Nortel's board of directors is now down to a rump of just three. A few months ago the board had nine members.
Mr. Zafirovski became CEO in 2005 and has presided over one of the biggest disasters in global corporate history - although you'd never think that it you read the oleaginous spin still being slathered all over these calamitous events by Nortel's egregious and shameless PR department.
According to them, "leadership has successfully stabilised the business and improved results over the last quarter. As a result Mike Zafirovski says it is the right time for change."
Happily the spin doctors will not be around much longer themselves. With Zafirovski consigned to the dustbin of history Nortel itself will shortly be no more. Last night the company announced that it is "asking" its accountants Ernst & Young "to take on an enhanced role with respect to the oversight of the business, sales processes and other restructuring activities.”
In other words, the jig's up and the last ones to leave and finally blow out the guttering candles at Nortel's now darkened and Dickensian corporate headquarters will be the insolvency experts originally called in to save the company. Not that they'll be complaining. For them it's been a very lucrative seven month gig since Nortel filed for bankruptcy.
The three board members left to waltz with the corpse are John MacNaughton, a sometime investment banker, Jalynn Bennet, who has been with Nortel since time immemorial and gets the booby prize for being so loyal, and last, but by no means least, David Richardson, an erstwhile Ernst & Younger-er himself who now holds the dubious honour of having been named as Nortel's last-ever chairman. It is to these three unfortunates that falls the unenviable task of shutting up the Nortel shop in as quiet and orderly a fashion as possible.
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