PulteGroup stock slides after CEO shakeup
NEW YORK— The chairman and CEO of homebuilder PulteGroup will retire next year after the company's founder and grandson pushed for leadership changes at the company.
Richard Dugas Jr., who has served as CEO since 2003 and chairman of the company's board since 2009, will retire ahead of schedule in May, 2017, as part of a sped-up succession plan.
Founder Bill Pulte, his grandson and board member Jim Grosfeld recently demanded an immediate CEO change and a different direction for the company, the company said in a statement.
The Atlanta-based homebuilder's stock fell nearly 6.57% to close Monday at $17.21, down $1.21.
"In an effort to avoid a contested public battle that would not be in the interests of shareholders, Mr. Dugas offered to accelerate and make public the Board's succession plan, prompting today's announcement.
The decision to move PulteGroup from to Atlanta, from suburban Detroit where it has been headquartered for about 60 years, played a factor, the Atlanta Journal-Constitution reported, citing two unnamed sources. The company moved in 2014.
The Atlanta-based builder, whose brands include Centex, Pulte Homes, Del Webb and DiVosta Homes, has formed a special committee of independent directors to find a successor.
In a note to investors, Credit Suisse analyst Michael Dahl says the CEO shift creates the risk of a fight over control and a potential poorly-timed shift in strategic direction. Given the company's "current positioning, we find it difficult to see a clear `best' outcome here."
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Contributing: The Associated Press