Verizon Names Wireless Head Lowell McAdam President, COO
Stock Chart for Verizon Communications Inc (VZ)
Verizon Communications Inc., the second-largest U.S. phone company, named wireless-unit head Lowell McAdam president and chief operating officer, putting him in line to succeed Chief Executive Officer Ivan Seidenberg.
The appointment, effective Oct. 1, “is an important step in the succession process for when Seidenberg retires from the company,” New York-based Verizon said today in a statement. The company also named Francis Shammo as chief financial officer.
McAdam has run Verizon Wireless, the most profitable part of Verizon, for more than three years, competing against rivals such as AT&T Inc. and its iPhone, helping the parent company grow even as it loses home-phone customers. McAdam, 56, will report to Seidenberg, who turns 65 in December 2011.
“McAdam’s been doing very well for Verizon Wireless, especially when you consider the potential advantage AT&T would have, given consumer preference for the iPhone,” said Drake Johnstone, an analyst at Davenport & Co. in Richmond, Virginia. “This is a good choice for Verizon to promote him.”
McAdam helped build Verizon Wireless into the biggest U.S. mobile-phone carrier, serving as the division’s operating chief after its inception in 2000. He previously ran wireless provider PrimeCo Personal Communications as CEO, worked as vice president of international operations at AirTouch Communications and held various roles at Pacific Bell.
“The board’s selection of Lowell to this key, central position underscores its commitment to reward success while working with me to prepare our company for an executive transition in the future,” Seidenberg said in the statement.
Verizon Communications rose 41 cents to $32.09 at 4 p.m. in New York Stock Exchange composite trading. The stock has gained 3.6 percent this year.
Besides overseeing the wireless unit for Verizon, McAdam will have responsibility of Verizon’s fixed-line unit. That business is losing home-phone customers as users switch to mobile phones or digital-calling plans from cable-TV carriers. The slowing economy has also prompted corporate customers to cut jobs and curb spending on phone services.
Verizon’s sales may shrink in 2010 for the first time in five years, by 1.2 percent to $106.5 billion, based on the average of analysts’ estimates in a Bloomberg survey. The company trails only AT&T, the exclusive U.S. carrier for Apple Inc.’s iPhone, in total telecommunications revenue.
McAdam may need to decide whether to change the ownership structure of Verizon Wireless, which is 45 percent owned by Vodafone Group Plc. Analysts have said the most likely outcomes are Verizon Communications buying Vodafone’s stake, Verizon Wireless paying dividends again or a merger of Vodafone and Verizon Communications.
Verizon’s wireless unit may receive a boon in January, when it will start offering the iPhone to its customers, two people familiar with the plan said in June.
McAdam will fill a role that was vacated by Dennis Strigl, who retired at the end of last year and wasn’t replaced.
Shammo, 49, will replace John Killian, who said this month he would retire to spend more time with his family. Shammo is currently president of Verizon Telecom and Business, which sells broadband, communications and entertainment services over Verizon’s FiOS fiber network and offers services to enterprise customers.
Daniel Mead, Verizon Wireless’s operating chief, will become head of the mobile business. Mead, 57, was one of the founding executives of the wireless unit and has also held executive roles at other Verizon businesses.
John Stratton, 49, Verizon Wireless’s marketing chief, will succeed Mead as the unit’s operating chief.
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