PeopleSoft CEO and president Craig Conway has been fired by the company's board of directors. He was replaced by Dave Duffield, its founder and chairman.
Conway's dismissal was thanks to a "loss of confidence" in the his ability, a statement by the company read. The board of directors also promoted chief financial officer Kevin Parker and executive VP Phil Wilmington to co-presidents and Aneel Bhusri, a former PeopleSoft exec now working as a venture capitalist, to vice chairman of the board.
"It's great to be back," Duffield said following the announcement. He served as PeopleSoft's CEO from its incorporation in 1987 through 1999, when he turned the reins over to Conway. Duffield said his re-appointment to the CEO spot is permanent.
The announcement was made alongside the company's quarter-end. Its revenue of $150 million was a pleasant surprise to many financial analysts.
The CEO dismissal puzzled some analysts.American Technology analyst Donovan Gow said: "I think pretty much everyone, myself included, thought that the quarter would be a complete disaster. On the one hand, they're saying we've lost faith in the CEO; on the other hand, they're saying they're gaining traction with new and existing customers. Obviously, they're not giving him credit for that."
Speaking on behalf of PeopleSoft's board, director George Battle declined to go into specifics about the reasons for the lost faith in Conway. The decision was made and approved Thursday night by the board's five independent directors, with Duffield and Bhusri abstaining from the vote, he said. PeopleSoft's eight-person board had consisted of Duffield, Conway and six outside directors including Bhusri.
"The very simple and plain truth is that over time the board has become increasingly concerned with Craig's leadership and essentially had lost confidence," Battle said. "There's no smoking gun, there's no accounting irregularity. He was not terminated under the for-cause provision in his contract."
Battle denied that PeopleSoft's ongoing battle with Oracle, which is continuing a hostile takeover campaign it launched in June 2003, had anything to do with Conway's firing. PeopleSoft's board has consistently rejected Oracle's offer, now valued at $7.7 billion. Conway, a former Oracle executive, strongly opposed the deal and was seen as having a personal stake in ensuring it did not occur. But Battle said PeopleSoft's transaction committee, comprised entirely of independent directors, unanimously agreed to reject each of Oracle's bids and was never at odds with Conway about the Oracle deal.
PeopleSoft's shares rose 15 per cent on the news.