Wound management specialist ConvaTec (CTEC) has poached Genus (GNS) chief executive officer (CEO) Karim Bitar in a bid to turnaround the embattled firm’s fortunes amid a reshuffle in management.
Shares in ConvaTec have jumped 5.1% to 141.1p while shares in Genus reversed 5.4% to £22.34.
Since 2011, Karim has helped to transform Genus by boosting its presence in key emerging markets, simplifying the business and supporting a strong pipeline of innovative products.
READ MORE ABOUT CONVATEC HERE
ConvaTec is hoping Karim can work the same magic when he joins on 30 September as the firm has suffered two profit warnings, with the latest in October costing previous CEO Paul Moraviec his job.
The company also plans to invest approximately $150m over three years to improve trading, which was significantly more than analysts expected.
In the third year, ConvaTec will incur an extra $50m of ongoing investment costs relating to commercial spending and research and development.
WHAT WENT WRONG AT CONVATEC?
‘Having made an impressive start by qualifying for the FTSE 100 index mere weeks after its IPO in 2016, ConvaTec’s shares have been in a falling trend since summer 2017,’ says AJ Bell investment director Russ Mould.
Over the last year, nearly a third of ConvaTec's market value has been wiped off.
‘Supply disruptions were followed by the departure of its chief financial officer in August 2017. Its US arm then failed to perform as expected and the UK market was very tough for its woundcare operations,’ comments Mould.
CONVATEC’S MANAGEMENT RESHUFFLE
Karim’s decision to join ConvaTec is not the only change at the top as chairman Christopher Gent has decided to retire with CEO Rick Anderson temporarily taking over as executive chairman from 9 May.
ConvaTec deputy chairman Steve Holliday also plans to leave the board from 31 March. Margaret Ewing and Ros Rivaz are set to join as senior independent director and chairman of the remuneration committee, respectively.
