- Signs for push-out forces
- After 18 years on the job
- Laud for Chalhoub
- Brian Recatto takes over
(management-change.com) — Elgin, Illinois, December 06, 2016 — Joe Chalhoub, chief executive of Heritage-Crystal Clean, leaves. It is a change at short notice. As announced by Heritage-Crystal Clean, Inc. in a news release on Tuesday, December 06, 2016, Joseph (Joe) Chalhoub, Chief Executive Officer, leaves the provider of parts cleaning, used oil re-refining, and hazardous and non-hazardous waste services in a surprising move after 18 years on the job, effective January 31, 2017.
It is the end of an era.
Chalhoub’s duties are taken over by Brian Recatto, currently President U.S. Operations at Gibson Energy Inc.
Recatto is already a director of the company. Often a board member is a last resort, someone who is turned to in desperation when a company can’t find other suitable candidates. On the other hand, directors-turned-executives represent a blend of outsider and insider.
They don’t have the constraints of a pure insider when it comes to leading painful changes or making unpopular decisions, and they have more company knowledge than a pure outsider.
Having been a director, Recatto understands the expectations and dynamics of the board and has knowledge of Heritage-Crystal Clean’s organization, finances and strategy.
No reason given
In the announcement, Heritage-Crystal Clean did not explicitly explain the reason for Chalhoub’s imminent move, leaving room for speculation.
Chalhoub said: “It is with mixed emotions that I announce my retirement.”
Generally speaking, it is often an alarm signal for investors when a CEO leaves the position at short notice and without a reasonable explanation.
Heritage-Crystal Clean said: “Heritage-Crystal Clean, Inc. … announces the retirement of its Founder, President and CEO Joe Chalhoub effective January 31, 2017.”
Precise information about the future plans of Chalhoub was not immediately available.
Cove Street Capital holds 12.09 percent stake
Cove Street Capital, LLC reported a 12.09 percent stake in Heritage-Crystal Clean, Inc. as of September 30, 2016. Cove Street Capital is a California-based hedge fund that was founded by Jeffrey Bronchick.
Chaired by Fred Fehsenfeld
Heritage-Crystal Clean, Inc. is chaired by Fred M. Fehsenfeld.
Fehsenfeld has served as a director on the Board since 1999.
On the job as CEO since 1999
Chalhoub, founder of Heritage-Crystal Clean, LLC, has served as President, Chief Executive Officer and director since the formation of the Company in 1999.
He started his career with Shell Canada as a process engineer, and he then worked for several years at SNC, an engineering firm.
In 1977 he founded Breslube Enterprises which he built into the largest used oil re-refiner in North America before selling a controlling interest to Safety-Kleen in 1987.
Chalhoub then served as an executive of Safety-Kleen from 1987 to 1998 and he was President of Safety-Kleen from 1997 to 1998.
Chalhoub holds a Chemical Engineering degree with high distinction from Ecole Polytechnique, Montreal.
Signs for push-out forces
It is not completely certain what forces eventually triggered Joe Chalhoub’s move.
The Push-out Score™ determined by management-change.com suggests that push-out forces may have contributed to the management change.
Read the full story in the management-change.com report 46.2016 ($).