Novell makes boardroom cull

Novell is bringing a new broom to its board room with the exit of CEO and chairman Jack Messman and CFO Joseph S. Tibbetts.

Replacing them, board President and COO Ronald W. Hovsepian will step up as CEO, director Thomas G Plaskett will take on the Chairman role, and Novell’s VP finance and corporate controller, Dana C. Russell, will run as interrim CFO.

Hovsepian has dropped the COO title. Bruce Lowry, Director, Global Public Relations told us that the company does not have anyone in mind for the role. ‘The decision on whether to name a new COO is for the board and Ron to decide in the future based on the needs of the organization,’ he told us.

All the changes at the helm are immediately effective as of yesterday, although the announcement was made after business hours.

In a conference call today, Hovsepian described the board overhaul as a ‘decision based purely on who is best suited to leave the company at this point.’

Lowry told us: ‘The promotion of Ron to this position has been some time in the making. The Board identified Ron as a potential successor to Jack some time ago, and has been working with Jack to develop him for this role.’

Messman, although instrumental in Novell’s Linux strategy and acquisition of the SUSE platform, has been under pressure for some time to show some results for his efforts on a fiscal level after a series of lacklustre quarters. In November of last year, he succumbed with a major restructuring move. Designed to save the company more than $200m a year, the cost-reductions involved slashing Novell’s workforce by 10 per cent and ‘end of lifing certain things’.

As well as helping to balance the books, the restructuring was also aimed at freeing up cash so that Novell can push forward its Linux plans, including potential acquisitions.

In the conference call today, Hovsepian didn’t nay-say questions over acquisitions, but his main message was to put renewed vigour behind Novell’s Linux strategy. He described the current strategy as one that ‘has allowed us to benefit from [Linux growth] in the IT sector,’ but that Novell under his leadership would be ‘more focussed on speed and urgency’. ‘A narrowed focus and energetic push is critical to drive revenues and enhance share-holder value,’ he said.

And the Linux focus can only put Novell’s legacy platform NetWare under a shadow. Hovsepian said that as well as Novell’s own transition to Linux products, it was important to communicate that to both its partners and customers. ‘It’s important they understand that strategy and embrace it,’ he said. Indeed the term NetWare never passed his lips.

Even so, the market appears to have welcomed the news with Novell stock opening nearly half a dollar higher at $6.46.

Any raised eyebrows over the departure of CFO Tibbetts, Hovsepian tried to nip in the bud. ‘We stand by our financials… there are no improprietaries,’ he said.

He said a permanent replacement would be sourced both externally and internally.