By Jon Kamp, Of DOW JONES NEWSWIRES
Medtronic Inc.’s (MDT) outgoing Chief Executive Bill Hawkins told employees Monday that the medical-device giant is making “excellent progress” searching for his successor, but isn’t there yet, and that he will remain at his post until the new CEO is named.
Hawkins announced in December that he planned to retire as chairman and CEO when the company’s fiscal 2011 ended, which happened late last week. But Hawkins also said he would stay on until his successor was appointed.
“The Board is making excellent progress; however, this process takes time and will extend into early FY12,” Hawkins said in a letter to company employees Monday, which Medtronic provided.
“As we said in December, to ensure a smooth leadership transition, I will continue to serve as Chairman and CEO until my successor is named,” Hawkins also said.
Medtronic has said it is searching outside the company for Hawkins’ replacement.
Medtronic under Hawkins bolstered its pipeline through a series of deals and its position in emerging markets. But it has also struggled to integrate a large spinal-company acquisition while dealing broader challenges such as pressure on heart and spinal-device prices.
A big question for Medtronic and its next CEO will be how soon investments in new products and emerging markets can counterbalance the effects of growth challenges for the company’s biggest products, such as heart-rhythm implants like pacemakers and defibrillators. Medtronic got more than half its $15.8 billion in sales in its 2010 fiscal year from markets for spinal and heart- rhythm devices.
Medtronic announced in February that it would cut up to 2,000 jobs in the just-concluded fiscal quarter, affecting 4% to 5% of its work force, in a company-wide effort to reduce costs and put its operations more in balance with current market conditions.
“We have our plan for FY12, and during this time of change, the most important thing we can all do is to stay focused on our business and our mission,” Hawkins said in Monday’s letter.
Shares of Medtronic recently traded up 1.1% to $42.20; they are up nearly 14% this year.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728; jon.kamp@dowjones.com
