- Push-out Score suggests push-out forces
- After less than two years in the position
- Praise and good wishes for Bloom
- Joseph Anto taking over in the interim
(exechange) — Memphis, Tennessee, April 27, 2018 — Mike Bloom, chief executive of Fred’s, leaves. It is an abrupt change. As announced by Fred’s Inc. in a news release on Friday, April 27, 2018, Michael K. (Mike) Bloom has left his post as Chief Executive Officer at the department store company after less than two years in the position, effective April 24, 2018.
No company wants a CEO to flame out in the first years.
Among the 3,000 largest publicly held companies incorporated in the U.S. based on market capitalization, the average tenure of the CEOs who departed over the past 12 months was 9.8 years, according to data compiled by exechange. Only 9 percent of the CEOs who departed over the past 12 months left the position within two years, and 19 percent left the position within three years.
Bloom’s duties were taken over in the interim by Joseph M. Anto, most recently Chief Financial Officer of Fred’s Inc.
“After the Company was not able to purchase certain assets from the Rite Aid Corporation and following the end of the 2017 fiscal year, the timing was right”
Bloom’s sudden departure from the CEO post is explained as follows. Heath Freeman, Chairman of the Board, said in a fairly biting statement: “After the Company was not able to purchase certain assets from the Rite Aid Corporation and following the end of the 2017 fiscal year, the timing was right, both for Mike and the Company, for him to step down.”
Precise information about Bloom’s future plans was not immediately available.
Fred’s said: “Fred’s Inc. … today announced the resignation of Chief Executive Officer Michael K. Bloom, effective as of April 24, 2018, to pursue other opportunities.”
“Not the result of any disagreement”
“His resignation was not the result of any disagreement with the Company or its operations,” Fred’s said.
It is a phrase that may be intended to prevent false rumors. It may also fuel further speculation and raise more questions than it answers. Such a phrase should be read very carefully. The exact wording may be insightful.
Share price decline
The change follows a decline in the share price of Fred’s Inc. since December 2016.
Chaired by Heath Freeman
Fred’s Inc. is chaired by Heath Freeman.
Chairman of the Board of Fred’s, Heath Freeman is the President and a Founding Member, of Alden Global Capital LLC, a New York-based investment firm focused on deep value, catalyst driven investing.
In the position of CEO since 2016
Michael K. Bloom has been the Chief Executive Officer of Fred’s, Inc. since August 29, 2016.
Michael K. Bloom joined the Company in January 2015 as President and Chief Operating Officer.
In August 2016, Bloom was appointed as the Company’s Chief Executive Officer and on March 7, 2017, Bloom was appointed as a Director.
Prior to joining the Company, Bloom served as the President and Chief Operating Officer for Family Dollar Stores, Inc. from September 2011 to January 2014.
He also spent more than 20 years with CVS Caremark Corporation, holding a variety of positions with increasing responsibilities in merchandising, marketing and operations and rising finally to Executive Vice President of Merchandising, Visual Merchandising, Marketing, Store Brand, Advertising and Supply Chain.
Before joining CVS, Bloom spent 10 years in merchandising and operations management with Virginia-based Peoples Drug Stores and the Florida division of Toronto-based Shoppers Drug Mart Corporation.
Bloom also resigned from the Company’s board of directors.
Generally speaking, when a top manager announces to step aside with no permanent successor in place, it’s a sign that the move was unplanned and too early.
Push-out Score suggests push-out forces
It is not completely certain what forces eventually triggered Mike Bloom’s sudden move.
The Push-out Score™ determined by exechange suggests that push-out forces may have contributed to the change.
Read the full story in the exechange report 19.2018 ($).