SET-TOP box-maker Pace, a front-runner for an “unluckiest UK tech firm” prize, has made Mike Pulli its new chief executive after his long-standing boss succumbed to pressure and stepped down.
Pulli inherits a company on the ropes, with a series of share-price lurches wiping out as much as 80 per cent of its value over the last year. Its supply chain has been decimated by the recent Thai floods, which dented the global supply of hard disks, and it was rocked by the Japanese tsunami before that. It also saw 20 per cent of its value disappear after a client delayed a major US contract.
But Pulli, president of the firm’s Americas division, will relish the challenge of turning things around. He was responsible for building Pace into a force in the Americas and, perhaps more importantly, he must suspect the worst is behind the firm. He will now take responsibility for realising the company’s five year plan, which coincided with a reorganisation that saw heavyweight Allan Leighton jump aboard as chairman.
Pulli’s predecessor Neil Gaydon had led the company for five years, building it into a world-leader in its field. But its recent losing streak, which has led analysts to speculate if Pace’s business model is too fragile, has left him tarnished. His departure should help to draw a line under massive revisions the company has been forced to make on its forecasts – it is bracing itself for a hit of up to £32m on 2012 operating profit – giving Pulli a clean slate.
Pace has made a partial comeback, with shares up from a low of 45p last month to 70p – boosted by a five per cent surge after yesterday’s statement.
Leighton said of Pulli’s promotion: “His background and gravitas in the industry make him the right leader to succeed Neil and deliver our strategic plan.”
Pulli’s arrival and Pace’s share climb has poured cold water on rumours of takeover approaches. But the long-term future of its business has been called into question, with many TV manufacturers now building smart-technology into their sets. Analysts say the firm’s strategy will be relevant for at least the duration of its five year plan.
Gaydon said yesterday he is taking some time off and will look for a “fresh challenge”. He will be hard pressed to find anything quite as challenging as the last year at Pace.