With Merrill Lynch & Co. (MER) posting its worst quarter in its 93 year history, the pressure on CEO Stan O'Neal has ended with him deciding to step down from his position. The Merrill board is unanimous on letting him go.
The company posted a third-quarter loss of $2.24 billion, coming from a $8.4 billion write-down connected to subprime mortgages. Others feel the entire picture hasn't been told yet, and other losses from the credit issues have yet to be revealed.
Another story adding to the problem is O'Neal evidently floated the idea of a merger with Wachovia (WB) without consulting the board for approval. That, more than anything, may have tipped the board's hand to get rid of him.
Some of the names being thrown around to replace O'Neal are Laurence D. Fink, chaiman and CEO of BlackRock (BLK), an investment business; Gregory Fleming, a co-president of at Merrill; and also the head of Merrill's brokerage unit Bob McCann is a possibility.
Another idea thrown around is to have Fleming and Fink share leadership responsibilities.
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So who gets the fun job of cleaning up the mess O'Neal left? The WSJ has put out 4 names, info about them can be found here http://www.newsvisual.com/newsvisual/2007/10/who-should-repl.html . Should Merrill hire someone from outside the company, or from within? Positive and negative arguments could be made for both sides.
Posted by: Ane | October 29, 2007 4:38 PM | Permalink to Comment