Quebecor CEO Robert Dépatie resigns for health reasons Republish Reprint by Christie Dobby
Apr 28, 2014
Source: Financial Post
Quebecor Inc. announced the second surprise change of its leader in little more than a year Monday, leaving the distinct impression of an organization in flux.
The Montreal-based telecom and media company cited health reasons for Robert Dépatie’s resignation as president and chief executive less than a year after he took over from Pierre Karl Péladeau.
The 55-year-old Mr. Dépatie rose to the role after a decade at the helm of the company’s growth engine, its cable and Internet division Videotron. He plans to remain with Quebecor until May 30 to oversee the transition as Pierre Dion, another long-serving executive, takes over as CEO.
Mr. Dion has also been with the company for a decade and has been president and CEO of its broadcast and publishing subsidiary TVA Group since 2005. In an interview Monday, he emphasized his lengthy experience on the Quebecor management team.
“Our model is very integrated — it’s a convergence model so all the main decisions we make as a group,” he said, noting that he has been at the table for crucial decisions including those related to Vidéotron. “I was close with Robert, I was close to Pierre Karl. We built this company as a team.”
When Mr. Péladeau revealed his plans to step aside from management last year, the shuffle came as a surprise but Mr. Dépatie was widely viewed as a star in the cable and telecom world.
In contrast, analysts say Mr. Dion is much more of an unknown and the move comes as a surprise.
“In my view, Dépatie was certainly one of the best executives in the sector,” Dvai Ghose, head of research at Canaccord Genuity, said Monday, pointing to his history of reinvigorating Vidéotron’s performance.
In a later email to clients, he noted that Mr. Dion “appears to be an able successor” but added that he is not well known to the financial community and “lacks direct experience in telecom and cable.”
“It will be a while before we see what impact Dépatie’s departure has on Quebecor,” Mr. Ghose wrote. “While we continue to like Quebecor’s solid cable franchise, wireless potential and valuation, we consider Dépatie’s departure a big loss for shareholders, although one which is difficult to quantify.”
Mr. Dion takes over at a time when Quebecor faces the erosion of its dominance of the Quebec television market as rival BCE Inc.’s IPTV offering gains ground.
While it has built a wireless business in Quebec, it has not yet rolled out LTE coverage and whether it will expand to the rest of Canada remains a mystery.
Mr. Dion would not go into detail about his plans for the wireless business Monday.
“Wireless is very strategic for us in Quebec. The business plan is going well and that’s all I’ll say for now,” he said.
Quebecor also declined to go into further detail about the health issues facing Mr. Dépatie or the timing of the board’s decision to recommend Mr. Dion as his replacement.
“It is with deep regret that I announce my retirement after 13 wonderful years with Vidéotron and Quebecor,” Mr. Dépatie said in the statement Monday. “In Pierre Dion, Quebecor has an exceptional manager and I have no doubt that he will lead the Corporation to new heights.”
“I wish to express the Board’s full confidence in Pierre Dion, a highly talented and experienced manager,” Brian Mulroney, who serves as vice-chairman of the board of Quebecor and Quebecor Media, said in the statement. “He possesses in-depth knowledge of the industries in which we operate and will be able to continue implementation of our business plan, to the benefit of our shareholders.”
Mr. Mulroney said Mr. Dépatie wished to spend more time with his family and Mr. Dion said in the statement he wished him a “happy retirement with is wife Christiane, his daughter Kim and his beloved granddaughter Mila.”
Mr. Dion will continue on as president and CEO of TVA Group until the board names a replacement.
Mr. Peladeau, the son of the company’s founder and controlling shareholder, announced his own plans to step aside in March 2013 and Mr. Dépatie took over last May.
While Mr. Peladeau initially assumed the role of chairman of the board, he stepped away from all official involvement with Quebecor this March, when he announced his intention to stand for office in the Quebec provincial election and said he would put his shares of the company into a blind trust if elected.
Although the Parti Quebecois was defeated at the polls — with some placing the blame at Mr. Peladeau’s feet for reigniting the debate over separatism — he won his seat in the riding of St. Jerome.
Quebecor spokesman Martin Tremblay said Monday that Mr. Peladeau continues to have no day-to-day involvement with the operations of the company.
© Financial Post