- Signs for push-out forces
- After almost three years on the job
- Laud, praise and thanks for Davis
- Jeff Leddy taking over
(management-change.com) — Los Angeles, California, February 21, 2017 — This news came the day after Presidents Day. Dave Davis, chief executive of Global Eagle, leaves. It is an abrupt change. As announced by Global Eagle Entertainment Inc. in a news release and in a regulatory filing published on Tuesday, February 21, 2017, David M. (Dave) Davis has already left the post as Chief Executive Officer at the provider of satellite-based connectivity and media in a surprising move after almost three years on the job, effective February 20, 2017.
No company wants a CEO to flame out in the first years.
Davis’ duties are taken over by Jeff Leddy, most recently founder and CEO at Verizon Telematics.
Already a director
Leddy is already a director of Global Eagle. 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, Leddy understands the expectations and dynamics of the board and has knowledge of Global Eagle’s organization, finances and strategy.
Global Eagle also announced that Tom Severson, Executive Vice President & Chief Financial Officer, resigned, effective February 20, 2017. The Board has initiated a CFO search to consider candidates for the position. In the interim, Leddy will serve as the Company’s principal financial officer.
“To pursue other endeavors”
Dave Davis’ move is explained as follows. Global Eagle said: “Dave Davis resigned as a Board Director and as CEO effective February 20, 2017 to pursue other endeavors.”
The phrase “to pursue other endeavors” is often used in corporate announcements and opens the door to speculation.
Generally speaking, it is often a wake-up call for stockholders when a CEO leaves the position abruptly and without a reasonable explanation.
Global Eagle said: Davis “on February 17, 2017 delivered notice of his resignation as Chief Executive Officer and as a member of our Board effective February 20, 2017”.
“Not due to any disagreement”
“Messrs. Davis’s and Severson’s resignations are not due to any disagreement with the Company,” Global Eagle 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.
Precise information about the future plans of Davis was not immediately available.
Share price decline
The change follows a sharp decline in the share price of Global Eagle Entertainment Inc. since February 2015.
PAR Capital Management, Inc. holds 33.97 percent stake
PAR Capital Management, Inc. reported a 33.97 percent stake in Global Eagle Entertainment Inc. as of December 31, 2016. PAR is a privately owned hedge fund sponsor.
Chaired by Edward L. Shapiro
Global Eagle Entertainment Inc. is chaired by Edward L. Shapiro.
Shapiro served as a Managing Partner of PAR Capital Management, Inc., a Boston-based investment management firm specializing in investments in travel, media and Internet-related companies from 1997 to 2016.
On the job as CEO since 2014
Davis has been the Chief Executive Officer of Global Eagle Entertainment Inc. since July 8, 2014.
He was named GEE’s CEO in July 2014, after serving as the company’s Chief Financial Officer and Chief Operating Officer.
Before joining GEE, Davis spent over three years in private equity, first as Senior Managing Director of Perseus LLC, then as Partner and Co-Founder of Bearpath Capital LLC.
A veteran of the airline industry, Davis spent nearly nine years at Northwest Airlines, where he served as EVP and Chief Financial Officer.
He took a leading role in Northwest’s merger with Delta Air Lines in 2008.
Davis also served as Chief Financial Officer of US Airways and Kraton Polymers.
An engineer by trade, Davis worked for Rockwell International and BF Goodrich Aerospace early in his career.
He holds a Bachelor of Aerospace Engineering and Mechanics degree from the University of Minnesota and an MBA from the University of Minnesota’s Carlson School of Management.
Davis will continue to support the Company as a consultant during a transition period.
At the time of Davis’ appointment as Chief Executive Officer at Global Eagle, Ed Shapiro, Chairman of the Board, had said: “I have worked closely with Dave in his various roles for over ten years. Given his airline industry experience and operational and financial leadership at GEE since its formation, Dave is ideally suited for this role. He is a proven leader with deep industry knowledge, business vision and the ability to foster collaboration among our talented team of employees across the world. He has been instrumental in driving the formation of GEE and the subsequent integration of our acquisitions, and he has the skills to accelerate GEE’s innovation in the inflight entertainment and connectivity (IFE&C) industry.”
Signs for push-out forces
It is not completely certain what forces eventually triggered Dave Davis’ 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 09.2017 ($).