Homebuilder PulteGroup Names CEO to Replace Richard Dugasby
Ryan Marshall, company’s president, will take over immediately
Founder Bill Pulte’s grandson appointed as a director
PulteGroup Inc. said its president, Ryan Marshall, will take over immediately as chief executive officer, ending a months-long campaign by the U.S. homebuilder’s founder for a change in leadership.
Marshall will replace Richard Dugas, who will remain as executive chairman of the board until the company’s 2017 shareholder meeting, according to a statement Thursday. Dugas in April announced plans to retire next year, after Bill Pulte, the company’s founder and largest shareholder, began pressing for an immediate change in direction.
Pulte had blamed Dugas for the departures of talented executives, overly aggressive land purchases before the housing crash and stock underperformance relative to some peers. Also Thursday, Bill Pulte’s grandson, who shares his name, was appointed to the board.
The builder’s founder “accomplished what he set out to do,” Bloomberg Intelligence analyst Drew Reading said in a phone interview. “He got Dugas out sooner rather than later. He facilitated changes to the board, including getting his grandson Bill appointed. They’re implementing cost cuts. They’re adopting a more-conservative land policy and are more systematically returning cash to shareholders through buybacks.”
Marshall had been the clear internal favorite to succeed Dugas, so his appointment shouldn’t come as a surprise to shareholders, Megan McGrath, an analyst at MKM Partners LLC, said in note to clients. “On the negative side, some newer investors may have been anticipating a more-aggressive change in leadership and an internal candidate could be a disappointment,” she said.
PulteGroup slipped 0.5 percent to $20.98 at 10:15 a.m. New York time. The shares have climbed 18 percent this year.
In a separate statement announcing the younger Pulte’s appointment as a director, the company said it entered into an agreement with the founder and related parties. The signers, who own a total of about 9 percent of the shares, will vote in favor of any board nominees and against any candidates not nominated by the board, as long as the grandson remains a director.
“My grandfather and I fully support the company’s value-creation strategy and we are pleased with the company’s ongoing actions to enhance shareholder value,” Pulte, 28, CEO of Pulte Capital Partners LLC., an unrelated investment firm, said in the statement.