Medtronic Inc. (NYSE:MDT) CEO Bill Hawkins sent a note to the company’s employees yesterday saying that he will be prolonging his stay as the medical device giant’s chief executive.
The search for Hawkins’ successor is taking longer than the company initially expected, according to the note.
Medtronic in December announced plans for Hawkins’ retirement, and said he would step down by the close of the company’s fiscal year in April, but a new leader for the Fridley, Minn.-based company won’t be selected until some time in early fiscal 2012, according to Hawkins’ message to employees.
While leading the Feb. 22 earnings call with analysts, Hawkins said that it would be his last call as CEO. A Medtronic spokesman did not say whether Hawkins would lead the earnings call in late May and cited a policy of not disclosing speakers in advance.
Previously an analyst speculated that current board member James Lenehan would be the new head of Medtronic. Given the plans for Hawkins’ slightly prolonged tenure, however, that appears less likely.
The pressures Medtronic faces in its upcoming fiscal year are much different than when Hawkins was appointed in 2007.
Since August 2007, the month Hawkins became CEO, Medtronic shares have fallen 30 percent to $37 from $53, though that period also includes the worst economic recession in American history since the Great Depression.
But Medtronic also was hampered by operational missteps, including the Sprint Fidelis debacle and continued problems in its spine business. Medtronic downgraded its 2011 profit forecast twice last year.
Hawkins, and his predecessors Art Collins and William George, were all Medtronic executives before being tapped for CEO and the company said in December that it would pursue a candidate outside of the company — a strong indication it wants new blood to recharge its businesses.