Tellabs Jumps After Declaring Dividend, Naming CEO
Tellabs Inc. (TLAB) shares rose the most since their initial public offering in 1983 after the phone- equipment manufacturer named acting Chief Executive Officer Dan Kelly to the job permanently and declared a $1-a-share dividend.
Tellabs shares climbed 21 percent to $3.56 at the close in New York. Before the rally, the stock had tumbled 27 percent this year.
Kelly, who will also serve as president, begins the role immediately, Naperville, Illinois-based Tellabs said yesterday in a statement. The 51-year-old had previously served as the company’s executive vice president of global products.
The special $1 dividend, which will be paid on Dec. 21, is part of a plan to shore up the stock after it tumbled to a 19- year low this month. The company announced plans last week to repurchase as much as $224.6 million worth of its stock to reward shareholders.
The company has posted eight straight quarters of losses amid slumping demand for its products. Under its previous CEO, Rob Pullen, Tellabs began shifting from older phone-network switches to more popular equipment for wireless systems. The company suffered a dual blow this year when Pullen died of cancer and Chairman Mike Birck announced he would step down from the board after being diagnosed with leukemia.
Kelly has more than 25 years of experience in the telecommunications industry. He has bachelor’s and master’s degrees in electrical engineering from the University of Notre Dame and a master’s in business administration from the University of Chicago.
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