The Bergen Record reports that Pathmark Stores’ stock price dropped almost 34 percent, closing at $5.25 last Friday, after it was announced that CEO Jim Donald was leaving the company to become president of Starbucks North America.
Donald is perceived as primarily responsible for Pathmark’s reorganization and enhanced performance over the past few years. The fact that his job is being split among three insiders who have been part of his team (Eileen Scott is becoming CEO, Frank Vitrano is the president, and Steven Volla is the new non-executive chairman) did not seem to assuage the markets.
Analysts interviewed by the paper that not only is Donald’s departure expected to hurt the chain’s performance, but it makes it less likely that Pathmark will be sold anytime soon; it was believed that Pathmark was a prime takeover candidate for one of the top national chains. (An attempt by Ahold to buy the company several years ago was foiled by the US Federal Trade Commission, which said the deal was anti-competitive.)
Donald said in a conference call last Friday that he only left because Starbucks made him an offer he “could not pass up.”
Donald is perceived as primarily responsible for Pathmark’s reorganization and enhanced performance over the past few years. The fact that his job is being split among three insiders who have been part of his team (Eileen Scott is becoming CEO, Frank Vitrano is the president, and Steven Volla is the new non-executive chairman) did not seem to assuage the markets.
Analysts interviewed by the paper that not only is Donald’s departure expected to hurt the chain’s performance, but it makes it less likely that Pathmark will be sold anytime soon; it was believed that Pathmark was a prime takeover candidate for one of the top national chains. (An attempt by Ahold to buy the company several years ago was foiled by the US Federal Trade Commission, which said the deal was anti-competitive.)
Donald said in a conference call last Friday that he only left because Starbucks made him an offer he “could not pass up.”
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