New blood

By Reuters  |  Print this article Print

HP is bringing in five new board members, including former eBay chief Meg Whitman. Three of the company's current directors will not stand for reelection.

Whitman is arguably the best-known of HP's new directors. At eBay, she oversaw a period of robust growth but was criticized for her acquisition of Web telephone company Skype. She recently lost out in a bid to become governor of California.

"With Leo coming in as CEO, we both thought it was appropriate to look at the board," HP Chairman Ray Lane said in an interview.

Lane said Russo will bring a strong track record in the telecommunications industry, called Reiner an "iconic CIO," and lauded Banerji's and Senequier's international experience.

Gleacher & Co analyst Brian Marshall said investors should welcome the move.

"To shake it up a little bit and get some of the old-school guys out of there and get some new-school blood in there, highlighted by Meg Whitman, this is a positive development," he said.

Apotheker, the former CEO of SAP AG, took over as chief of HP in November and analysts are widely expecting to see more changes at the company. Chief Marketing Officer Michael Mendenhall recently left HP, and Apotheker brought in SAP veteran Bill Wohl as chief communications officer.

In an interview, Apotheker made it clear that he had no plans to stand pat.

"You'll see that HP will be driving a lot of changes across its entire business," he said.

HP's board has seen major turnover and been harshly criticized over the years for controversies such as the hiring and firing of CEO Carly Fiorina, the 2002 acquisition of Compaq, and -- most infamously -- the so-called "pretexting" spy scandal in 2006.

Hurd's departure in August stunned investors and sent shares tumbling 8 percent in the first trading day after the announcement.

In the wake of Hurd's exit, HP's board was lambasted by Ellison, who hired Hurd as co-president a month after. Ellison called the board "cowardly."

IBM CEO Sam Palmisano also chided HP's board for its handling of Hurd's departure.

Shares of Palo Alto, California-based HP were down 16 cents at $46.60 following announcement of the board changes, which came after the stock closed down 0.9 percent at $46.78 on the New York Stock Exchange.

(Reporting by Gabriel Madway; Editing by Steve Orlofsky, Gary Hill)