2010-07-27 08:08:00
Tony Hayward to Be Replaced by Bob Dudley as CEO of BP
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In conjunction with the release of their Q2 earnings numbers, BP announced earlier this morning that current CEO Tony Hayward has agreed to step down from his post on October 1st.
BP Managing Director Bob Dudley has agreed to take over the role of CEO and will be charged with the unenviable task of rebuilding the company's shattered image.
Don't feel bad for Tony Hayward though (as if you do), as the embattled current CEO of BP with walk away with $1.6 million in severance cash, a gold-plated pension (estimated to be worth $1 million per year) and his current holding of BP shares. Some politicians are so enraged with Hayward's exit package that they are demanding that BP withhold any payouts until the oil spill has been cleaned up.
Four months ago, barely anybody in the United States knew who Tony Hayward was, and now he is one of the most hated men in the country.
Tony Hayward was an easy scapegoat, as he made a couple of major gaffes that just served to enrage the American public.
First off, Hayward famously said that "I would like my life back" while being interviewed in Venice, Louisiana about a month after the oil spill started. This statement enraged the family members of the 11 people killed on the Deepwater Horizon, as well as the thousands of people who had seen their paychecks crushed by the oil spill.
About a month later, Tony Hayward angered the American public once again when he took part in a yacht race around England's Isle of Wight. At the time, oil was still gushing from BP's blown-out well, and Hayward's ill-timed yacht race just further fanned the flames of hatred.
Tony Hayward sealed his own fate, and his impending departure was never really in question.
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In addition to their public image taking an incredible beating, BP has also lost an incredible amount of value over the past 4 months. BP, which at $38.65 per share is worth approximately $121 billion, was trading at around $60/share just a few short months ago.
Earlier today, the company announced a Q2 loss of $17 billion, as they have set aside $32.2 billion for costs related to the oil spill. In order to help cover these costs, BP announced that they will be selling $30 billion worth of assets over the next 18 months.
By announcing this massive loss and the upcoming resignation of Tony Hayward in the same day, BP is clearly hoping that they will be able to cut their losses and start fresh in the fall.
It's interesting to note that Bob Dudley will be the first non-British CEO of BP. Dudley grew up in Mississippi, and clearly BP is hoping that Dudley's appointment as CEO will help to moderate some of the hatred that is being leveled at the company by the American public.
Source: WSJ.com DealBook - BP Posts $17 Billion Loss, Plans $30 Billion in Sales
Filed under: General Market News
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